Which of the Following Statements Is CORRECT

Multiple Choice

Which of the following statements is CORRECT?

A) Depreciation is included in the estimate of free cash flows (FCF = EBIT(1 - T) + Depreciation - [Capital expenditures + ΔNOWC]) ,hence depreciation is set forth on a separate line in the cash budget.
B) If cash inflows from collections occur in equal daily amounts but most payments must be made on the 10th of each month,then a regular monthly cash budget will be misleading.The problem can be corrected by using a daily cash budget.
C) Sound working capital policy is designed to maximize the time between cash expenditures on materials and the collection of cash on sales.
D) If a firm wants to generate more cash flow from operations in the next month or two,it could change its credit policy from 2/10,net 30 to net 60.
E) If a firm sells on terms of net 90,and if its sales are highly seasonal,with 80% of its sales in September,then its DSO as it is typically calculated (with sales per day = Sales for past 12 months/365) would probably be lower in October than in August.