One Way a Firm Can Reduce the Amount of Cash

question 133

Multiple Choice

One way a firm can reduce the amount of cash it needs in any one month is to

• A)speed up the collection of receivables
• B)delay the payment of wages
• C)delay the payment of taxes
• D)delay the payment of payables
• E)all of the above

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Definitions:

Flexible Budget

A budget that adjusts or flexes with changes in volume or activity levels of the organization.

Variable Cost

Expenses that vary directly with levels of output or production volume.

Spending Variance

The difference between the actual amount spent and the budgeted amount in financial management, often analyzed in cost accounting.

Employee Salaries

The regular compensation paid to employees for their labor or services, typically expressed as an annual amount or hourly wage.