Which of the Following Statements Is NOT CORRECT

question 43

Multiple Choice

Which of the following statements is NOT CORRECT?

• A) A company may hold a relatively large amount of cash and marketable securities if it is uncertain about its volume of sales,profits,and cash flows during the coming year.
• B) Credit policy has an impact on working capital because it influences both sales and the time before receivables are collected.
• C) The cash budget is useful to help estimate future financing needs,especially the need for short-term working capital loans.
• D) If a firm wants to generate more cash flow from operations in the next month or two,it could change its credit policy from 2/10,net 30 to net 60.
• E) Managing working capital is important because it influences financing decisions and the firm's profitability.