What is the simple meaning of cash flow?
Answer and explanation
Correct answer: Movement of money into and out of a business
Cash flow records the movement of actual cash and cash equivalents entering and leaving a business during a period. Cash may come from sales or financing and may leave through purchases, wages, rent, or other payments. Therefore option A is correct. Rent is only one possible outflow, while a product name or opinion is not cash flow.
Frequently asked questions
What is the correct answer to this question?
Movement of money into and out of a business
Why is this the correct answer?
Cash flow records the movement of actual cash and cash equivalents entering and leaving a business during a period. Cash may come from sales or financing and may leave through purchases, wages, rent, or other payments. Therefore option A is correct. Rent is only one possible outflow, while a product name or opinion is not cash flow.
Which subject and chapter does this question cover?
This is a Class 11 Business Studies question. Chapter: Sources of Business Finance. Topic: Concept, nature and importance of business finance.
