Which of the Following Statements Is Correct

question 70

Multiple Choice

Which of the following statements is correct?

• A) Poor synchronization of cash flows that results in high cash management costs can be partially offset by increasing disbursement float and decreasing collections float.
• B) The size of a firm's net float is primarily a function of its natural cash flow synchronization and how it clears its checks.
• C) Lockbox systems are used mainly for security purposes as well as to decrease the firm's net float.
• D) If a firm can speed up its collections and slow down its disbursements,it will be able to reduce its net float.
• E) A firm practicing good cash management and making use of positive net float will bring its check book balance as close to zero as possible,but must never generate a negative book balance.

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The ability to think about or plan the future with imagination or wisdom; also refers to guiding principles or aspirations that drive individuals or organizations.

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The ability to make considered decisions or come to sensible conclusions.

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