This paper revisits the variational theory of traffic flow, now under the presence of continuum lateral inflows and outflows to the freeway say Eulerian source terms. It is found that a VT solution exists only in Eulerian coordinates when source terms are exogenous meaning that they only depend on time and space, but not when they are a function of traffic conditions, as per a merge model. In discrete time, however, these dependencies become exogenous, which allowed us to propose improved numerical solution methods. In Lagrangian and vehicle number-space coordinates, VT solutions may not exist even if source terms are exogenous.