Quiz Ch 19 – T/F Cash Flow Source: Receivables Collections
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
True or false: Cash flow mainly hinges on receivables, except for cash-on-delivery payments.
True or false: Cash flow mainly hinges on receivables, except for cash-on-delivery payments.
True or false: Settling a $5,000 debt to a supplier will result in a $5,000 cash reduction.
True or false: Biotech companies often accumulate significant cash holdings to finance potential investment requirements, particularly if their drugs achieve regulatory approval.
True or false: Managers who have a significant cash surplus might be enticed to adopt a less stringent management approach.
True or false: “In financially troubled firms, a dollar of cash retained within the company is commonly considered to be worth less than a dollar to shareholders.
True or false: In general, inventory tends to be more liquid than receivables.
True or false: When a company extends credit to a customer for goods, there is no immediate alteration in its cash position.
True or false: The firm generates cash through the growth of current liabilities.
True or false: When a firm’s customers take two weeks to pay their bills on average, about half of each month’s bills are postponed to the following month.
True or false: Short-term financing plans are typically crafted through a trial-and-error process.