Business cash
What it means
Business cash is the money in the business's own bank accounts, chequing and savings, plus any cash on hand. Keep it separate from your personal accounts, which belong under personal net worth.
In the Loan Ready calculator, business cash shares a line with accounts receivable. Add the two together.
See also: Accounts receivable, Cash & bank accounts
Why lenders ask
Cash is the business's cushion. Lenders look at how much is on hand today and, through your bank statements, how steady the balance stays from month to month. Frequent overdrafts or bounced payments raise questions, even when sales are good.
Good to know
Expect to be asked for several months of business bank statements. Reading them over before a lender does lets you explain anything unusual.