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anticipated to be generated over a time in future, i.e. it is futuristic in nature. Various
terms related to Cash flow statement are as follows :
(i) Cash: It refers to money and includes both currency and cheques. It is the life blood
of every business.
(ii) Cash flow: It refers to the movement of money in and out of a business during a

specific period of time.
(iii) Cash inflow: It is defined as the movement of money into a business. Cash sales
and collection from debtors are prominent sources of cash inflow.
(iv) Cash outflow: It is defined as the movement of money out of a business. Cash
purchases and payment to creditors are prominent sources of cash outflow.

5. Various components of 'cash inflow' and 'cash outflow' are as follows :

Cash Inflow Cash Outflow

Owner's Equity Start-up Expenses Sales Commission

Loan from Friends Assets Freight Interest

Bank Loan Working Capital Salary Phone

Cash Sale Receipt Raw Material Rent

Credit Sale Collection Packing Material Utilities

Office Expenses Loan Repayment

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