Which One of the Following Statements Is Correct Concerning the Cash

question 68

Multiple Choice

Which one of the following statements is correct concerning the cash cycle?

• A) The longer the cash cycle, the more likely a firm will need external financing.
• B) Increasing the accounts payable period increases the cash cycle.
• C) A positive cash cycle is preferable to a negative cash cycle.
• D) The cash cycle can exceed the operating cycle if the payables period is equal to zero.
• E) Adopting a more liberal accounts receivable policy will tend to decrease the cash cyclE.

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Definitions:

Customers

People or companies that buy products or services from a business.

Procter & Gamble

An American multinational consumer goods corporation, specializing in a wide range of personal health/consumer health, and hygiene products.

Store Brand Labels

Products that are manufactured or procured by a retailer and sold under its own brand name, typically at a lower price than national brands.

Brand Awareness

Consumers' recognition and knowledge of a specific brand's features or identity.