Which of the following describes inflows for cash flow?

• A. Outflow from business expenditures
• B. Inflow from sale of goods and services, loans, lines of credit, and asset sales
• C. Depreciation expenses
• D. Loan repayments

Answer: (B)

Cash flow analysis looks at inflows as funds that enter the business. The description that matches inflows includes cash received from customers for goods and services, money borrowed through loans, funds drawn on lines of credit, and cash proceeds from selling assets. These increase the cash balance, so they are inflows. In contrast, cash outflows are payments the business makes, such as expenditures and loan repayments. Depreciation is a non-cash expense that reduces accounting profit but does not generate cash itself, while loan repayments reduce cash but are not inflows. So the description listing receipts from sales, borrowing, credit, and asset sales best captures cash inflows.