Asked by Andrew Young on Jul 12, 2024
Verified
When the amount of inventory on hand is increased, then it is considered a use of cash.
Inventory
The total value of a company's goods that are ready for sale, in the process of being produced, or used as raw materials.
Use of Cash
Refers to how a business or individual utilizes available cash resources, including operations, investments, and financing activities.
- Analyze the outcome of varied financial processes on the liquidity movement within a company.
Verified Answer
SS
Sagar SinhaJul 18, 2024
Final Answer :
True
Explanation :
Increasing inventory requires spending cash to purchase more goods, which is considered a use of cash because it reduces the cash balance.
Learning Objectives
- Analyze the outcome of varied financial processes on the liquidity movement within a company.