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Which of the Following Statements Is FALSE

Question 3

Multiple Choice

Which of the following statements is FALSE?


A) Under the Modigliani-Miller assumptions of perfect capital markets,the amounts of payables and receivables are irrelevant.
B) One factor that contributes to the length of a firm's receivables and payables is the delay between the time a bill is paid and the cash is actually received.
C) Collection float is the amount of time it takes before payments to suppliers actually result in a cash outflow for the firm.
D) The credit that the firm is extending to its customer is known as trade credit.

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