A Cash Budget Will Have Value Only If It Is

question 92

Multiple Choice

A cash budget will have value only if it is actually used and ____________. ​

• A)records of actual income and expenses are kept
• B)spending never deviates from the budgeted amount
• C)it reflects actual financial position
• D)it takes into account only credit transactions

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Definitions:

Unlevered Cost of Capital

The cost of capital for a company without debt, reflecting the risk of its equity alone.

Cost of Debt

The effective rate that a company pays on its current debt, inclusive of all fees and interest.

Total Assets

The sum of all assets owned by a company, including cash, investments, equipment, and real estate.

EBIT

Earnings Before Interest and Taxes, a financial metric that calculates a company's profitability based on operations, excluding interest and taxes.