What's the Difference Between Cash Flow and Profit? | FlowHaxa
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What's the Difference Between Cash Flow and Profit?

Profit is revenue minus expenses, counted the moment a sale is invoiced. Cash flow only counts money that has actually landed in the account. A business can log a profitable month and still have no cash on hand if that revenue is sitting in unpaid invoices, this gap is where most small business cash crunches actually happen, not from a bad business model.

Want the full method? See cash flow vs. profit: why the difference can sink a profitable business for a full worked example.

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Gardy D.

Gardy D.

Editorial contributor at FlowHaxa, a publication of IGNE Publishing, LLC. Covers budgeting, small-business cash flow, and fintech.

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