Question

Distinguish between cash flows and revenues and expenses. Why should a nurse manager or executive be concerned with issues such as cash flow and inventory levels?

Answer 1

Cash Flows; Cash Flow is the amount of money moving in and out of your business/Trading operations over a specific period of time and mainly it will determine your Liquidity.

Revenue; Revenue is the amount of money that an entity earns from sale of goods or rendering services. and it will only measure the total income from sales and it is listed on the top line of the Income Statement.

Expenses; An Expense is the amount of money spent or costs incurred by an entity to generate revenues. essentially it would be called as cost of doing business and these are the sum of all activities performed to generate revenue.

Inventory management will affect the movement of cash into or out of your company.

Inventory refers to the assets that are intended for sale and the relationship between inventory and cash flow is largely determined by your choice of inventory accounting like the level of inventory you chooses to stlck and inventory cost and saleability of stock.