Cash management system objectives include
A) maintaining sufficient cash to meet disbursal needs.
B) maintaining idle cash balances at "doomsday event" levels.
C) maintaining accounts payable balances at zero by early bill payment.
D) All of the above are objectives of the system.

Question

Quizplus · Accepted Answer

The primary goal of a cash management system is to maintain sufficient cash to meet disbursal needs. This is necessary to ensure that the business can cover expenses such as payroll, rent, and other bills as they come due. Maintaining idle cash balances at "doomsday event" levels is not a common objective as it would tie up precious resources that could be invested elsewhere to generate returns. Similarly, maintaining accounts payable balances at zero by early bill payment is not a realistic or desirable goal as it would likely lead to cash flow problems and missed opportunities for investment or growth.

Cash Management System Objectives Include