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The key differences between accrual accounting and real cash flow are demonstrated by the concept of the cash cycle.
A company's cash cycle is the process that converts sales (based upon accrual. Operating cash flow (OCF), often called cash flow from operations, is an efficiency calculation that measures the cash that a business produces from its principal operations and business activities by subtracting operating expenses from total revenues.
In this article we will discuss about operating cycle and its functions. Working capital is the life blood of any business, without which the fixed assets are inoperative. Start Up Small Business Working Capital. For new businesses or those about to launch, working capital has a slightly different meaning.
It refers to the amount of money you will be borrowing from the bank or a similar lender to keep your fledgling operation going until such time as your revenue is able to cover those expenses.Operating cycle concept of working capital