Which of the Following Statements About Cash Management Is False

question 50

Multiple Choice

Which of the following statements about cash management is false?

• A)Depreciation expense does not appear explicitly on the cash budget, but its tax effects are included.
• B)If cash flows are not uniform during the month, then weekly or perhaps daily cash budgets should be prepared rather than monthly budgets.
• C)Compensating balance requirements do not affect a firm's target cash balance.
• D)Cash management involves costs, and it is important to analyze whether the benefits received outweigh the costs incurred.
• E)The cash budget is the foundation of good cash management.