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Why Businesses Fail

The Problem Most business owners do not understand how to use financial statements to manage their businesses "by the numbers." Instead, they use substitute indicators which betray them, such as amount of cash in the bank. This often has little to do with profitability and the resulting taxes. Some business owners believe that the faster you grow the better. However, studies show that companies can grow themselves into bankruptcy because they run out of cash and working capital. Financial tools...

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