A use of cash can be deﬁned as any activity that:
A) Diminishes the cash balance of a ﬁrm.
B) Generates cash for the ﬁrm.
C) Affects the cash on hand only.
D) Involves a checking account.
E) Affects current assets only.

Question

Quizplus · Accepted Answer

A use of cash is any activity that decreases the cash balance of a firm. The other options are not comprehensive enough to capture all activities that can be considered a use of cash.

A Use of Cash Can Be Deﬁned as Any Activity