Cash flow categories are the different categories that businesses use to organize and differentiate a company’s sources of incoming cash, outgoing cash and other changes in cash. These categories typically include operating activities, investing activities, financing activities, and cash and cash equivalents. Operating activities refer to the core operations of a company, including sales, purchases and expenses related to day-to-day business activities. Investing activities refer to items such as investments in stocks, bonds or real estate, as well as sales or acquisitions of assets. Financing activities refer to the receipt and payment of both short-term and long-term debt by the company. Lastly, cash and cash equivalents refer to highly liquid assets held by the business, such as savings and checking accounts. By formally categorizing cash flows, companies can better manage their finances and make business decisions with a higher level of accuracy.