Which of the Following Statements Are Correct Concerning the Cash

question 9

Multiple Choice

Which of the following statements are correct concerning the cash balance of a firm?
I. Most firms plan on maintaining a minimum cash balance at all times.
II. The cumulative cash surplus shown on a cash budget is equal to the ending cash balance plus the minimum cash balance retained by the firm.
III. The cumulative cash surplus at the end of March is used as the beginning cash balance for April when you are compiling a projected monthly cash balance report.
IV. A negative cumulative cash surplus indicates a borrowing need by the firm.

• A) I and III only
• B) II and IV only
• C) I and IV only
• D) II and III only
• E) I and II only

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Definitions:

Independent Variables

Variables that are manipulated or controlled in an experiment to test the effects on dependent variables, without being influenced by other variables in the study.

Dependent Variables

Dependent variables are outcomes or responses whose changes are influenced by the manipulation of independent variables in an experimental setup.

Positively Related

A relationship between two variables in which they move in the same direction.

Slope Regression Coefficient

A parameter in linear regression that quantifies the change in the dependent variable for each unit change in an independent variable.