Which Statement Is Not True

question 35

Multiple Choice

Which statement is not true?

• A)A firm should always have a surplus holding of cash.
• B)If a firm has a cash deficit, it may need to reschedule its cash payments.
• C)If a firm has a cash deficit, it may need to arrange to borrow money.
• D)If a firm has a cash surplus, it should make the best use of the surplus.

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Definitions:

Bank Reconciliation

A bank reconciliation is a process that explains the difference between the bank balance shown in an organization's bank statement and the corresponding amount shown in the organization's own accounting records.

Credit Memo

A document issued by a seller that reduces the amount a buyer owes, typically related to returns or adjustments.

Note Receivable

A financial asset representing a written promise to receive a certain amount of money at a future date or on demand.