Which One of the Following Statements Is NOT True

question 40

Multiple Choice

Which one of the following statements is NOT true?

• A) The APR is the appropriate rate to do present and future value calculations.
• B) The EAR is the appropriate rate to do present and future value calculations.
• C) The EAR is the true cost of borrowing and lending.
• D) The EAR takes compounding into account.

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Definitions:

Merchandise Purchases Budget

A financial plan detailing the amount of goods a company needs to purchase during a period to meet expected sales demands and maintain inventory levels.

Master Budget

An aggregated budget that represents a company's overall plan of action for a specified period, integrating individual budgets for income, spending, and capital expenditures.

Master Budget

A comprehensive financial planning document that consolidates all of an organization's individual budgets.

Sales Budget

A financial plan detail outlining projected sales for a specific period, guiding marketing and production strategies.