Which of the following, if true, does NOT strengthen the case for Aard

QUESTION

Which of the following, if true, does NOT strengthen the case for Aardvark closely monitoring its cash flow?

A) The company needs to make sure it is not spending too much.
B) The company needs to make sure it is generating enough revenue.
C) The company needs to make sure its employees perform well.
D) The company needs to make sure it can always pay its bills.
E) The company needs to make sure it can make capital expenditures.

ANSWER

Answer: C
Explanation: C) Employee performance is an important factor in the success of a service company like Aardvark, but how the company monitors that does not relate directly to cash flow. The careful management of cash flow is important for other reasons, such as controlling company spending (Choice A), making sure it has enough money (Choice B), and preserving cash on hand to pay bills (Choice D) and invest in capital (Choice E).