Which option is a form of electronic funds transfer commonly used by businesses today?

Which option is a form of electronic funds transfer commonly used by businesses today?

• A. Checks
• B. Cash
• C. ACH transfers
• D. Currency

Answer: (C)

The main idea is recognizing a form of electronic funds transfer that businesses commonly use. ACH transfers are an electronic payment method that moves money between bank accounts through the Automated Clearing House network. They’re widely used for payroll, vendor payments, and recurring business expenses because they can be arranged in batches, are cost-effective, and reduce the need for physical handling of checks. Why this is the best choice: ACH transfers are designed specifically for electronic, bank-to-bank transfers, making them efficient and scalable for business operations. They typically settle within one to two business days, with some options for same-day processing, which helps businesses manage cash flow smoothly. This contrasts with checks, which are paper-based and require manual processing; cash and currency refer to physical money and aren’t electronic transfers. In short, ACH transfers embody the electronic, routine, business-to-bank payments that are common today, so they’re the correct form of electronic funds transfer in this context.

The main idea is recognizing a form of electronic funds transfer that businesses commonly use. ACH transfers are an electronic payment method that moves money between bank accounts through the Automated Clearing House network. They’re widely used for payroll, vendor payments, and recurring business expenses because they can be arranged in batches, are cost-effective, and reduce the need for physical handling of checks.

Why this is the best choice: ACH transfers are designed specifically for electronic, bank-to-bank transfers, making them efficient and scalable for business operations. They typically settle within one to two business days, with some options for same-day processing, which helps businesses manage cash flow smoothly. This contrasts with checks, which are paper-based and require manual processing; cash and currency refer to physical money and aren’t electronic transfers.

In short, ACH transfers embody the electronic, routine, business-to-bank payments that are common today, so they’re the correct form of electronic funds transfer in this context.