The business cycle depicts the relationship between a business owner’s investments and drawings, the assets used to generate income, the return on assets and cash flow. Changing cash gains and drains can have a massive impact on a business’s performance.
Cash Gains
Faster Collection
Decreases in stock or work in progress
Slower payment of suppliers
Cash Drains
Slow collection of debtors
Increase in stock or work in progress
Business loan repayments
Business tax payments
Faster payment of suppliers
