Financial flexibility refers to a companys practice of allowing liquidity to vary throughout the year.

True or False

A liquidity crisis occurs when persistently insufficient operating cash flows lead to an inability to pay obligations.

True or False

A firms operating cycle for a merchandising firm such as Target is the time it takes from the receipt of merchandise inventory to its sale, to collection of the related receivable for a customer using an in-house credit card.

True or False

If Whole Foods maintains cash and investments of $852 million, inventory of $1,123 million, interest expense of $41 million, accounts payable of 1,338 and other assets of $1,034 million, then working capital is $637.

True or False

The net liquidity index, a means of measuring liquidity, represents the dollar days of each current asset less the days in accounts payable.

True or False