[amp_mcq option1=”Overdraft” option2=”Float” option3=”Factoring” option4=”None of the above” correct=”option2″]<\/p>\n
The correct answer is: B. Float<\/strong><\/p>\n A float is a temporary difference between the balance of a bank account as shown in a bank statement and the balance of the same account shown in the books of the account holder. It can occur for a variety of reasons, including:<\/p>\n The float can be either positive or negative. A positive float occurs when the balance in the bank statement is higher than the balance in the account holder’s books. This can happen, for example, if a check has been written but not yet cashed. A negative float occurs when the balance in the bank statement is lower than the balance in the account holder’s books. This can happen, for example, if a deposit has been made but not yet processed by the bank.<\/p>\n The float can have a significant impact on the cash flow of a business. For example, if a business has a positive float, it may be able to delay paying its bills without having to worry about running out of cash. Conversely, if a business has a negative float, it may need to borrow money to cover its expenses.<\/p>\n Businesses can manage the float by carefully planning their cash flow and by working with their banks to minimize the time lags between transactions.<\/p>\n Overdraft is a situation in which a bank account balance falls below zero. This can happen when a customer withdraws more money from the account than is available. Overdrafts can be costly, as banks typically charge fees for them.<\/p>\n Factoring is a financial arrangement in which a company sells its accounts receivable to a third party, called a factor. The factor then collects the payments from the customers and pays the company a portion of the amount owed, less a fee. Factoring can be a useful way for companies to improve their cash flow.<\/p>\n None of the above options are the correct answer.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”Overdraft” option2=”Float” option3=”Factoring” option4=”None of the above” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-52654","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"\n\n