Bulldogs Inc. maintains a cash buffer for unexpected cash outlays for the year amounting to 3,000. Bank of Wildcats charges Bulldogs P15 for every transaction with the bank. The bank grants 5% annual interest. Bulldogs is contemplation if it will still need to have the cash buffer. How much is the annual savings in annual holding cost of cash for Bulldogs if it will not have a cash buffer?
Bulldogs Inc. maintains a cash buffer for unexpected cash outlays for the year amounting to 3,000. Bank of Wildcats charges Bulldogs P15 for every transaction with the bank. The bank grants 5% annual interest. Bulldogs is contemplation if it will still need to have the cash buffer. How much is the annual savings in annual holding cost of cash for Bulldogs if it will not have a cash buffer?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Bulldogs Inc. maintains a cash buffer for unexpected cash outlays for the year amounting to 3,000. Bank of Wildcats charges Bulldogs P15 for every transaction with the bank. The bank grants 5% annual interest. Bulldogs is contemplation if it will still need to have the cash buffer. How much is the annual savings in annual holding cost of cash for Bulldogs if it will not have a cash buffer?
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