Question

What is the measurement of the amount of money coming into and going out of a practice?

1) accounts receivable
2) gross revenue
3) profits
4) net income
5) cash flow
6) petty cash

Answer 1

The correct term for measuring the amount of money entering and leaving a business or practice is 'cash flow.' It includes the total incoming money from various sources minus the outgoing expenses.

Step-by-step explanation:

The measurement of the amount of money coming into and going out of a practice or business is called cash flow. This term reflects the inflow of revenues from sales, investments, and other sources, versus outflow from paying expenses, such as labor, materials, and capital costs. For example, an insurance company's cash flow includes premiums and investments as money coming in, and payments for claims and operating expenses as money going out.

The term the student is looking for from the options provided is cash flow, which directly refers to the movement of money in and out. It is important for businesses to manage their cash flow efficiently to ensure they have enough cash to cover their obligations and to make new investments when needed.

Answer 2

The measurement of the amount of money coming into and going out of a practice is known as 5 cash flow.

Step-by-step explanation:

Cash flow refers to the net amount of cash and cash equivalents being transferred into and out of a business. It is a crucial metric for assessing a company's financial health as it reflects the ability to generate cash and meet financial obligations. While options like accounts receivable, gross revenue, profits, and net income are essential financial metrics, they focus on different aspects of financial performance.

Cash flow is the measurement of money entering and leaving a business.

It reflects the liquidity and financial health by tracking the actual movement of cash.

Unlike profits or net income, cash flow considers both income and expenses in real-time, offering a dynamic view of a business's financial state.