Which Is Not a Cash Management Activity

question 13

Multiple Choice

Which is not a cash management activity?

• A)Purchase of inventory.
• B)Purchase of land.
• C)Payment of taxes.
• D)Receipt of interest on cash equivalents.

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Definitions:

Compound Interest

Calculating interest that includes both the original principal amount and all previously accumulated interest on a loan or deposit.

Simple Interest

The method of calculating interest charges based on the principal amount only, not compounding on accumulated interest.

Deposit

A sum of money placed into a bank account or given as security for a contractual obligation.

Ordinary Annuities

Fixed payments received or paid out over a designated series of periods where the payments occur at the end of each period.