Cash flow is different from income.
Income is the difference between sales revenue (collected and uncollected) less expenses (paid and unpaid).You can make a million dollars in income and still end up bankrupt if you aren’t able to collect the cash from customers after the sales.
Cash flow, on the other hand, is the difference between the actual cash a company receives from customers less the cash actually paid for expenses (payroll, vendors, taxes, etc.).
Analyzing and managing cash flow is particularly important to small businesses because there is such a small margin for error when cash flow is tight or negative.