What type of outflows include payments made to suppliers, employees, and taxes?

Operating outflows refer to the payments made in the course of a company’s day-to-day operations. This includes cash outflows for expenses necessary to conduct business, such as payments to suppliers for goods and services, salaries and wages for employees, and taxes owed to government entities. These costs are essential for maintaining ongoing operations and generating revenue.

In contrast, investing outflows primarily involve cash spent on acquiring or upgrading physical assets, such as property, plant, and equipment. Financing outflows are related to transactions that funding a corporation’s operations and investments, such as repaying debt or distributing dividends to shareholders. Equity outflows are not a recognized category in standard cash flow analysis. Hence, operating outflows are specifically categorized to reflect the regular expenses that sustain the operational aspect of a business, making this the correct choice.