Which situation is NOT likely to lead a firm to hold marketable securities?

A) The firm has replaced an obsolete machine with a new model; a large write-off must be taken on the old machine.
B) The firm must meet a known financial commitment, such as financing an ongoing construction project.
C) The firm must finance seasonal operations.
D) The firm has just sold long-term securities and has not yet invested the proceeds in earning assets.

Marketable Securities

Marketable securities are liquid financial instruments that can be quickly converted into cash at market value, such as stocks, bonds, or treasury bills.

Financial Commitment

Obligations, typically in the form of debt or leases, that a company is legally required to fulfill in the future.

Seasonal Operations

Business activities that fluctuate according to the time of year, often due to changes in weather or consumer behavior.