Choice "B" is correct. Amortization of bond discount is an income-related item; thus, it is almost automatically an operating activity, not a financing activity. That knocks out two of the answers. Because the amortization of the discount was originally subtracted to get to net income in the first place, it is added back to net income for an indirect method statement of cash flows.
Choice "a" is incorrect. Amortization of bond discount is not a financing activity at all and certainly not a financing cash inflow.
Choice "d" is incorrect. Amortization of bond discount is not a financing activity at all and certainly not a financing cash outflow.
Choice "c" is incorrect. Because the amortization of the discount was originally subtracted to get to net income in the first place, it is added back to, not subtracted from, net income for an indirect method statement of cash flows.