6-41 Which of the Following Is NOT True

question 54

Multiple Choice

6-41 Which of the following is NOT true?

• A)The fastest growing area of finance companies in recent years has been in the area of leasing and business loans.
• B)Business loans represent the largest portion of the loan portfolio of finance companies.
• C)Finance companies rely on short-term commercial paper and customer deposits to finance their assets.
• D)Finance companies rely on short-term commercial paper and long-term debt to finance their assets.
• E)Finance companies are now the largest issuers of commercial paper in the U.S.

---

Definitions:

Minimum Cash Balance

The least amount of cash a company maintains on hand to meet immediate operational expenses.

Net Cash Flow

The overall flow of currency into and out of an enterprise, critically influencing its liquid assets.

Borrow

Borrow refers to the act of receiving something with the intention to return it, often with interest in the case of financial borrowing.

Accounts Receivable Period

The average number of days that it takes for a company to receive payments from its customers for invoices issued.