MGMT 3850 Ch.12

Solid cash management enables a business owner to:

________ is the most important, yet least productive, asset that a small business owns.

Which of the following statements concerning cash management is false?

The first step in managing cash more effectively is:

More companies fail for the lack of ________ than for the lack of ________.

Which of the following measures a company's liquidity and its ability to pay its bills and other financial obligations on time?

________ typically lead(s) sales; ________ typically lag(s) sales.

A cash budget reveals important clues about how well a company ________.

A firm's cash budget should:

A cash budget:

Which of the following is not a step in creating a cash budget?

A cash budget is based on the cash method of accounting, meaning that cash receipts and cash disbursements are recorded in the forecast only when ________ is expected to take place.

Jane is arguing with Joan about how much cash their small retail outlet needs as they prepare their cash budget. Jane feels that with the Christmas season coming, their busiest time, they need more cash available while Joan feels they do not because their sales volume will be up significantly. Jane and Joan are discussing which step of the cash budgeting process?

A cash budget is only as accurate as the ________ forecast from which it is derived.

What factors can drastically affect a company's cash flow?

Which of the following would be a potential source of information for preparing a sales forecast?

When a firm sells goods or services on credit, the owner needs to remember that for cash budgeting purposes:

It is recommended that new business owners estimate cash disbursements as best they can and then add on another ________.

When estimating the firm's end-of-month cash balance, the owner should first:

The fact that the cash budget illustrates the flow of cash in a business helps the owner to:

By planning cash needs ahead of time, a small business is able to achieve all but which of the following?

The "big three" of cash management include:

Experts estimate that ________ percent of industrial and wholesale sales are on credit, while ________ percent of retail sales are on credit.

Small businesses selling on credit find that

The cost to check a potential customer's credit at a reporting service starts at:

________ small businesses take the time to conduct a credit check.

An important source of credit information that collects information on small businesses that other reporting services ignore is:

According to the American Collectors Association, if a business is writing off more than ________ of its sales as bad debts, it needs to tighten its credit and collection policies.

A collection agency typically takes ________ percent of the amounts they collect on past due accounts

To encourage credit customers to pay invoices promptly, a business owner should:

Once a small business has established a firm written credit policy and has clearly communicated it, the next step in building an effective credit policy is to:

Once a credit account becomes past due, a small business owner should:

According to the American Collector's Association, only ________ of accounts more than 90 days delinquent will be paid voluntarily.

The Fair Debt Collection Practices Act prohibits business owners from:

An effective approach to successful collections includes:

A contract in which a business selling an asset on credit gets a security interest in that asset (the collateral), protecting its legal rights in case the buyer fails to pay, is a:

An entrepreneur can potentially improve collections by

Efficient cash managers:

For product-based businesses, ________ often represents their largest capital investment

Which of the following is true about inventory management for the small business owner?

Only about ________ percent of a typical business' inventory turns over quickly.

Which of the following inventory management techniques would help a business owner make the best use of his company's cash?

Exchanging goods and services for other goods and services, or ________, is an effective way for a small business to conserve cash.

The real benefit of barter for the entrepreneur is that:

Barter offers business owners the benefit of:

Which of the following is an effective way to trim overhead?

Which of the following statements concerning leasing is true?

Leasing allows business owners to forecast cash flows more ________ because lease payments are ________ amounts paid over a particular time period.

"Stick to what you are good at and ________ everything else" is an approach to reduce overhead costs.

Rather than build the current year budget on increases from the previous year's budget, ________ evaluates the necessity of every item.

When investing surplus cash, the small business owner's key objectives should be on the ________ of the investment.

A checking account that never has idle funds-because it draws funds from an interest-bearing master account to cover checks written-is called a:

A sweep account is a checking account that: