This phrase means that you can't do something right now because you're too busy, too upset, you're not prepared, or some other similar reason.
"Now" is not usually used as the subject of a sentence. For example, it's incorrect to say "Now is 5 o'clock". Instead, you say:
It's 5 o'clock now.
But "Now is good" or "Now is not good" are the exceptions to this rule:
A: Hey, when do you think we can sit down and go over the budget?
B: Now's good.
A: Do you mind if I ask you a few questions about it?
B: Sorry, now's not good actually. Can I call you back later this afternoon?