Do increase in trade payable increase or decrease cash flow?

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1153256

2026-09-07 00:20

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An increase in trade payables typically results in an increase in cash flow. This is because when a company delays payment to suppliers, it retains cash that would otherwise be used for these payments. Therefore, higher trade payables can improve short-term liquidity and provide more cash for other operational needs. However, it’s important to manage trade payables carefully, as excessive delays can strain supplier relationships.

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