What Is the Purpose of the Financing Section of a Cash

question 79

Multiple Choice

What is the purpose of the financing section of a cash budget?

• A)to indicate amounts that should be borrowed when the ending cash balance is less than the prior year
• B)to indicate amounts that should be borrowed when the ending cash balance is less than the amount management desires
• C)to indicate amounts that should be borrowed when expenses exceed revenues
• D)to comply with GAAP budgeting requirements

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Definitions:

Possible Outcomes

Refers to all the potential results that can occur in any probabilistic or random event.

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 and 1.

Sampling Error

Refers to the difference between the population parameter and the sample statistic due to the fact that the sample is not a perfect representation of the population.

Statistical Error

The difference between a measured or observed value and the true value, often arising from sampling or measurement limitations.