The cash forecast treats payroll withholding and sales-tax collections as money freely available for operations. What exposure does this create?
- ACustomers pay every contractor tax
- BTaxes are optional until project closeout
- Tax deadlines can create cash exposure
- DTax records replace job costing
Why C is correct
The best answer is: Tax deadlines can create cash exposure. Tax liabilities may arise before customer collection and some funds are withheld for agencies. Forecasting and timely deposits protect operating cash and avoid penalties. The new fact pattern changes the setting, not the governing rule or management control. The other choices either skip a required step, apply a different rule, or fail to address the stated risk.