Which of the following is true regarding float?
A) Cheques written by a firm generate collection float.
B) Cheques received by a firm create disbursement float.
C) In general, a firm's disbursement activities and its collection activities generate float.
D) A firm's float is negative when its available balance equals its book balance.
E) A firm cannot exploit float by using the cash needed to cover a cheque that has not yet cleared.
Correct Answer:
Verified
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