Q. Which of the following matter is relevant with cash receipts and disbursement method of preparing Cash Budget ?
-
(A)
While determining the cash payments, it is necessary to estimate the credit sales.
-
(B)
While estimating cash receipts, it is not necessary to estimate the figure of credit sales.
-
(C)
Debtors Ratio is used to estimate the timings when cash collections would be obtained from credit sales.
-
(D)
While estimating the total amount of cash payment for purchases, it is necessary to decide from which suppliers materials are to be purchased.
✅ Correct Answer: (C)
Debtors Ratio is used to estimate the timings when cash collections would be obtained from credit sales.