Business Finance

Just like the body needs blood to live, a business needs money to survive. If something were to happen to the flow of money in a business, the business would soon die.

Businesses need money for a few reasons:

• To pay everyday expenses, including rent, utilities, and employees
• To replace and expand inventory (the quantity of materials required to make finished goods or the quantity of finished goods themselves)
• To expand and grow (by purchasing more factories and equipment, for example)
• To meet the interest payments on debts