Finance is the management, creation, and study of money and investments. It explains the reasons why governments, companies or individuals need money and the method used to utilize that money. And the transactions such as long-term liabilities, owner’s equity and changes to short-term borrowings are called Financing activities which involve the cash flow between the company and the source of its funding. The capital of any business comes from equity or debt. As for equity, it’s the issuance of a stock for investors to purchase. And debt is when the company takes a loan from a bank, financing company, or an investor.