Which of the Following Statements Is False

question 9

Multiple Choice

Which of the following statements is false?

• A) A basic principle of cash management is to increase the speed of paying liabilities.
• B) A company should plan the timing of major expenditures in light of its operating cycle.
• C) A cash budget will help determine if additional financing will be necessary.
• D) A key principle of cash management is to increase the speed of collection on receivables.

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Definitions:

Opportunity Costs

The value of the best alternative that is foregone when a different option is chosen.

Special Order

A one-time order that is not considered part of the company’s normal ongoing business.

Capacity

The maximum output that a business can produce in a given period with available resources.

Production Constraint

Any factor that limits the volume or type of production a company can achieve, such as equipment capacity or availability of materials.