Which of the Following Is True Regarding flOat

question 144

Multiple Choice

Which of the following is true regarding float?

• A) Cheques written by a firm generate collection float.
• B) Cheques received by a firm create disbursement float.
• C) In general, a firm's disbursement activities and its collection activities generate float.
• D) A firm's float is negative when its available balance equals its book balance.
• E) A firm cannot exploit float by using the cash needed to cover a cheque that has not yet cleared.

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Definitions:

Delegate Duty

A concept where an individual or entity assigns responsibilities or tasks to another party, typically to ensure tasks are completed by those with specific expertise.

Professional

An individual who is expert and skilled in a particular field, typically requiring specialized education and training.

Client Consent

Agreement from a client, often required by law or professional standards, before certain actions are undertaken on their behalf.

Professional Negligence

The failure of a professional to perform their duties with the competence that their profession requires, resulting in harm or loss.