Which One of the Following Statements Is Correct

question 26

Multiple Choice

Which one of the following statements is correct?

• A)Net float decreases every time a firm issues a check to pay one of its suppliers.
• B)A positive net float indicates that collection float exceeds disbursements float.
• C)Firms prefer a zero net float over a positive net float.
• D)Net float is equal to collection float minus disbursement float.
• E)Net float is equal to a firm's available balance minus its book balance.

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Definitions:

Marketable Securities

Financial instruments that are easily convertible into cash, typically with high liquidity and short maturity periods, such as stocks and bonds.

Another Company

This term refers to an entity different from the one currently being discussed or involved.

Volatile Interest Rates

Interest rates that fluctuate frequently and unpredictably, often affecting borrowing and saving costs.