Reconciling the Paradox of Positive Profit and Negative Cash Flow

One of the paradoxes of business that accrual accounting sorts out is the reconciliation between cash flow (liquidity) and profit. The rest of this article is a summary of a case study/example utilized in Farm and Ranch Management to explain how profits and cash flow can be opposite, how this can be analyzed, and how the concept of financial feasibility and investment analysis can be used to make strategic farm and ranch decisions.