Effective cash management involves applying all of the following cash management principles except:
A) Encourage collection of receivables, offer discounts for payments received early.
B) Keep only necessary levels of assets.
C) Plan expenditures.
D) Leave excess cash available for unexpected expenditures.
E) Delay payment of liabilities until the last possible day.

Question

Quizplus · Accepted Answer

Effective cash management aims to optimize the use of cash, ensuring that it is invested to earn a return rather than leaving excess cash idle, which does not contribute to the financial health of a company. Choices A, B, C, and E are all strategies aimed at improving cash flow and utilization.

Effective Cash Management Involves Applying All of the Following Cash