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What does cash flow mean in a business?

Answer and explanation

Correct answer: Movement of money into and out of the business

Cash flow means the movement of actual money into and out of a business during a period. Money may come from sales, investment or borrowing, and it may leave through purchases, wages, rent or other payments. Cash flow is related to liquidity, whereas profit is calculated by comparing income and expenses and may include non-cash items. Hence, option A is correct.

Related tags

Cash-FlowIncomePaymentsFinancial-ManagementIntroduction To EntrepreneurshipEntrepreneurial Skills IArtificial IntelligenceClass 9 Mcq

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