Which of the Following Statements Is CORRECT

question 86

Multiple Choice

Which of the following statements is CORRECT?

• A) Shorter-term cash budgets,in general,are used primarily for planning purposes,while longer-term budgets are used for actual cash control.
• B) The cash budget and the capital budget are developed separately,and although they are both important to the firm,one does not affect the other.
• C) Since depreciation is a non-cash charge,it neither appears on nor has any effect on the cash budget.
• D) The target cash balance should be set such that it need not be adjusted for seasonal patterns and unanticipated fluctuations in receipts,although it should be changed to reflect long-term changes in the firm's operations.
• E) The typical cash budget reflects interest paid on loans as well as income from the investment of surplus cash.These numbers,as well as other items on the cash budget,are expected values;hence,actual results might vary from the budgeted amounts.

Understand the procedure for claiming life insurance proceeds.

Know the importance and benefits of a "free look" period in life insurance.

Understand the financial evaluation of life insurance including cash value and net cost.

Identify reliable resources for estimating life insurance needs and comparing premiums.

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Definitions:

Dodd-Frank Act

A comprehensive and complex piece of financial reform legislation passed in 2010 in the United States, aimed at preventing future financial crises by improving accountability and transparency in the financial system.

Mortgage Loans

Loans secured by real property through the creation of a mortgage note, enabling borrowers to purchase property.

Subprime Mortgages

Loans given to borrowers with lower credit ratings, often at higher interest rates due to the increased risk of default.

Restrictive Covenants

Restrictive covenants are clauses in contracts that impose limitations or conditions on one party's actions, typically used in employment and real estate to protect business interests.