Which of the following statements is FALSE?
A) Firms with seasonal cash flows may find themselves with a surplus of cash during some months that is sufficient to compensate for a shortfall during other months. However, because of timing differences, such firms often have short-term financing needs.
B) A company forecasts its cash flows to determine whether it will have surplus cash or a cash deficit for each period.
C) Like seasonalities, positive cash flow shocks can create short-term financing needs.
D) When sales are concentrated during a few months, sources and uses of cash are also likely to be seasonal.
C
Explanation: C) Like seasonalities, negative cash flow shocks can create short-term financing needs.
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