What does cash inflow refer to?

Cash inflow refers to the money that is received by an individual or company. This includes various forms of incoming funds, such as sales revenue, income from investments, or any other sources that contribute positively to the cash balance of the entity. Understanding cash inflows is crucial for assessing the financial health and operational efficiency of a business, as it impacts liquidity and the ability to cover expenses and obligations.

The other options do not represent cash inflow accurately. Money paid to creditors involves cash outflow, as it signifies payments being made. Investment losses point toward a decline in financial assets rather than an incoming cash flow. Costs associated with business operations also represent cash outflow, as they reflect expenses incurred rather than money received. Thus, the correct interpretation of cash inflow is integral to financial reporting and analysis in both personal finance and business contexts.