Chapter 19.4, Problem 19.4ACQ

Summary Introduction

To discuss: Whether maximizing disbursement float is a good business practice

Introduction:

Cash management refers to the process of handling and using cash in the business. Cash management is necessary because the businesses are motivated to hold cash for speculation, precaution, and for carrying out business-related transactions.

Float refers to the difference between the cash value mentioned in the books and the cash value mentioned in the bank passbook.