If First Bank Receives a Check for Collection on Friday

question 43

True/False

If First Bank receives a check for collection on Friday at 4:30 p.m., it does not have to present the check to the payor bank by midnight Saturday.

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Definitions:

Flexible Policy

An adaptable approach allowing for adjustments in strategies or procedures in response to changing conditions.

Current Assets

Assets that are expected to be sold, consumed, or converted into cash within one year or one business cycle, whichever is longer, including cash, inventory, and receivables.

Sales

The total amount of goods and services sold by a company during a specified financial period, reflecting the company's ability to generate revenue.

Marketable Securities

Financial instruments that can be easily converted to cash without losing much value.