The general term used to refer to where or how businesses obtain their funds is known as?

• A. Working capital
• B. Sources of Finance
• C. Cash Flow
• D. Assets

Answer: (B)

Understanding where money comes from is about identifying the sources of finance. This term covers all the ways a business can raise funds, including internal options like retained profits or selling assets, and external options such as bank loans, issuing shares, or receiving grants. It’s different from working capital, which refers to the short-term funds needed to run daily operations; cash flow, which is about the timing of money entering and leaving the business; and assets, which are the resources the business owns. So the general term for where or how a business obtains its funds is sources of finance.