Managers Use Cash Flow Predictions To

question 97

Multiple Choice

Managers use cash flow predictions to:

• A) Make decisions about acquiring new property, plant and equipment.
• B) Keep or eliminate a product line.
• C) Maintain or downsize a department.
• D) Insource or outsource production of a product.
• E) All of these answers are correct.

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Definitions:

Maturity Factoring

Short-term financing in which the factor purchases all of a firm’s receivables and forwards the proceeds to the seller as soon as they are collected.

Short-Term Financing

Borrowing funds or obtaining financial support for a short duration, typically less than a year, to cover immediate needs.

Factor Purchases

Transactions where a company outsources services or acquires assets, typically involving a third-party, or "factor," to facilitate business operations.

Receivables Collection

The process of managing and collecting payments from customers who have purchased goods or services on credit.