An inbound train is coming toward you. It's about to arrive at your stop and open its doors. An outbound train is leaving...the kind you have to jump the turnstiles and make a mad dash to catch.
Take that metaphor and apply it to a company's cash flow. Money comes in. Money goes out.
Inbound cash flow represents the funds that pull into your firm's station. It's the cash you get from selling your products or services. It's also additional cash that comes from anything else. Sell a factory for $10 million...that $10 million counts as inbound cash flow. Win a lawsuit for $200,000...that $200,000 also gets tallied as inbound cash flow.
The opposite, of course, is outbound cash flow. That term refers to the money that leaves your station...the checks you have to write. Day-to-day expenses, cash for acquisitions or for new equipment, when you lose a lawsuit...these all count as outbound cash flow.
Related or Semi-related Video
Finance: How is inventory managed for ca...3 Views
Up Next
What is cash flow vs. earnings? Earnings are how much a company has made in profit after they have paid things like taxes and operating expenses. C...