What is business finance?

Business finance is the funding a business needs for commercial purposes. It is the money business owners require to start, run, or expand a business. Finance is the foundation of any business. It is nearly impossible to succeed without strong finances in place. You use finance to purchase assets, goods, and raw materials.

Why is business finance important?

When this happens, business finance is a vital tool for managing and understanding the financial implications of borrowing money. By incorporating this information into your financial data, you can make more educated decisions about how much capital to borrow. You can also decide which options make the most sense and your repayment schedule.

What financial statements should a small business have?

Financial statements such as the income statement, balance sheet, and cash flow statement provide insights into a small business’s financial health. Small businesses need to understand their tax obligations, track deductible expenses, and file taxes on time. Accounting as a small business owner begins with laying a proper foundation.