Firms Attempt to Maintain Minimum Cash Balances to Meet Short

question 83

True/False

Firms attempt to maintain minimum cash balances to meet short term working capital needs such as payroll. Any cash from operating and investing activities in excess of that required to maintain the firm's desired minimum cash balance may be used to repay any outstanding debt.

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Definitions:

Raw Materials

Basic materials and substances used in the initial stages of production and manufacturing processes.