Find the BAT total cost of holding cash for your firm if $96,723 is needed each week to pay bills, the lower cash limit is $75,123, standard deviation of the disbursements is $12,789, the interest rate is 3.16%, and the cost of transferring funds is $38. O A) $3,476 B) $4,432 O Č) $4,109 D) $4,911 O E) $3,862

Find the BAT total cost of holding cash for your firm if $96,723 is needed each week to pay bills, the lower cash limit is $75,123, standard deviation of the disbursements is $12,789, the interest rate is 3.16%, and the cost of transferring funds is $38. O A) $3,476 B) $4,432 O Č) $4,109 D) $4,911 O E) $3,862

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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F2 Penco Supply spends £428,000 a week to pay bills and maintains a lower cash balance limit of £75,000. The standard deviation of its disbursements is £18,900. The applicable interest rate is 5 per cent and the fixed cost of transferring funds is £65. What is the firm's optimal initial cash balance based on the BAT model?
ABC Corporation would like to know what its optimal cash balance for its petty cash fund. The daily average disbursement is P5,000. ABC operates 365 days a year. Cost to transfer money into the account average P250 each time. If the money is not in this account, it could have been in an investment account earning 5% per year. Requiired: 1. Optimum cash balance 2. Total cost of holding and maintaining the optimal cash balance
Please answer fast please arjent in a.b and c arjent
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A business plans to use £20,000 of cash during the forthcoming year. It holds most of its cash in a deposit account from which it costs £30 to make each withdrawal and which pays interest at 10 per cent p.a. What is the optimal size for each withdrawal?
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Parramore Corp has $10 million of sales, $2 million of inventories, $4 million of receivables, and $3 million of payables. Its cost of goods sold is 75% of sales, and it finances working capital with bank loans at a 7% rate. Assume 365 days in year for your calculations. A. What is Parramore's cash conversion cycle (CCC)? Do not round intermediate calculations. Round your answer to two decimal places. days B. If Parramore could lower its inventories and receivables by 12% each and increase its payables by 12%, all without affecting sales or cost of goods sold, what would be the new CCC? Do not round intermediate calculations. Round your answer to two decimal places. days C. How much cash would be freed up, if Parramore could lower its inventories and receivables by 12% each and increase its payables by 12%, all without affecting sales or cost of goods sold? Write out your answer completely. For Example, 13.2 million should be entered as 13,200,000. Do not round intermediate…
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