Revenue is the first metric that appears on an income statement, and for good reason. It’s the starting point for calculating profit, and generating enough of it means your business can cover operating expenses and stay afloat in the long run.
Yet, despite revenue’s importance, there’s a lot of confusion around it. What does (and doesn’t) count as revenue? Is it the same as profit? And does it guarantee positive cash flow?
Let’s get into the basics of revenue, how to calculate it, and how it differs from profit and cash flow.
When you think about your business’s revenue,
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