?WHAT IS THE DIFFRENCE BETWEEN CASH IN HAND AND PROFIT
Profit is not always represented by increase in cash in hand. For example, if the goods costing Rs.20,000 are sold for Rs.18,000 on cash, there is an increase in our cash in hand by Rs.18,000 but the fact is that we have a loss of Rs.2,000.Therefore, the result of the business operations in the form of profit or loss can not be attributed to increase or decrease in cash in hand.