A toy store with a calendar year-end is likely to have:
A)unpredictable fluctuations in cash flow from quarter to quarter.
B)the largest cash inflow from operations in the second and third quarters (April - September).
C)a fairly stable cash flow across all four quarters.
D)the largest cash inflow from operations in the fourth and first quarters (October - March).

Question

Quizplus · Accepted Answer

A toy store with a year-end in December will likely experience the largest cash inflow from operations in the fourth quarter (October-December) due to holiday shopping, followed by the first quarter (January-March) as customers redeem gift cards and make returns. Therefore, option D is the most likely scenario for a toy store with a calendar year-end.

A Toy Store with a Calendar Year-End Is Likely to Have