Simile Inc. has a total annual cash requirement of P9,075,000 which are to be paid uniformly. Simile has the opportunity to invest the money at 24% per annum. The company spends, on the average, P40 for every cash conversion to marketable securities. What is the Total Opportunity Cost of keeping cash in the bank?
Q: Green Corporation anticipates a cash requirement of P1,000 over a 1- month period. It is expected…
A: Given, Cash requirement (1-month) = P1,000 Annual interest rate = 24% Transaction cost of borrowing…
Q: The firm's average accounts receivable balance is P2.5 million, and they are financed by a bank loan…
A: In finance the lockbox system is a service that many banks provide. It is related to receipt of…
Q: Zycad has sales of $110 million a year. If Zycad reduces their processing float by 3 days, what is…
A: The computation of increase in firm’s average cash balance is as follows:
Q: The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can…
A: Total costs :- the whole of a company's costs in producing a specific level of output. It is…
Q: The financial manager of Sarap Corporation wants to determine the amount of cash outlays to be spent…
A: The financial manager of Sarap Corporation wants to determine the amount of cash outlays to be spent…
Q: The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can…
A: To determine the transactions costs (per month) associated with the cash infusions we first need to…
Q: A firm requires Rs. 20 million in cash for meeting its transaction needs over the next four months,…
A: Ordering costs and carrying costs are taken into consideration while determining Economic Order…
Q: Konerko, Inc., manageent expects the company to earn cash flows of $13,227, $15,611, $18,970, and…
A: Given that;Expected earnings over next four years are $13,227, $15,611, $18,970, and $19,114…
Q: able securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in…
A: In this we need to use Baumol model of cash management.
Q: Whitson Co. is looking for ways to shorten its cash conversion cycle. It has annual sales of…
A: In the above question we have asked the effect of new policy on company's cash conversion cycle…
Q: Lux Co. would like to maintain its cash account at a minimum level of P25,000, but expect the…
A: Optimal upper cash limit means the limit where the cash balance is of the amount which is of ideal…
Q: how much cash should Buccaneer raise from selling securities each week to minimize its costs of…
A: Economic Order cash is the cash quantity hat should maintain by the entity in order to minimize the…
Q: Whitmer Inc. sells to customers all over the U.S., and all receipts come in to its headquarters in…
A: Lockbox System - It is a technique of management of mailing float. There are certain advantage of…
Q: The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can…
A: Two types of costs are involved in fund raising in this question: 1. Cost incurred in selling…
Q: Knob, Inc., is a nationwide distributor of furniture hardware. The company now uses a central…
A: As per the given information: Credit sales - $198.00 million Flat fee of First National - $150,000…
Q: Primrose Corp has $15 million of sales, $2 million of inventories, $3 million of receivables, and $1…
A: Cash conversion cycle can be calculated by using this equation CCC = Inventory conversion period +…
Q: If real gets a cash infusion of P1 million each time it needs cash, what are the total costs per…
A: As per Bartleby guidelines, in case of multi-part questions, we are only allowed to answer the first…
Q: ntonio is an analyst at Barrilla Group. The firm turns over its inventory 5 times each year. It has…
A: Cash conversion cycle tells that how much period is required to collect money from customer and…
Q: Viron Corporation has a cash conversion cycle of 100 days and a bank credit line of $5 million at 5%…
A: Cash conversion cycle refers to the number of days which has incurred in converting the investment…
Q: The firm PAR inc. forecasts monthly disbursements of $ 75,000 over the next year. The firm invests…
A: Data given: Monthly requirement of cash = $75,000. Fixed Transaction cost = $150…
Q: Kindly answer all the questions and use 360 days in a year in all problems. Thank you. 1. The…
A: “Since you have posted a multiple question, we will solve first question for you. To get the…
Q: Data on Nathan Enterprises has determined that it needs Php 7.8 million in cash per week. Data on…
A: Economic order quantity model is that inventory model which is used to order the quantity of…
Q: Baumol Model and Miller-Orr Model 3. Buccaneer, Inc., has determined that it needs $10 million in…
A: For Financial Management and Policy, Baumol's Model and Miller Orr Model of Cash Management: For…
Q: Parramore Corp has $12 million of sales, $3 million of inventories,$3.25 million of receivables, and…
A: Cash conversion cycle: It can be defined as the financial measure that is used by the business in…
Q: Pinocchio Inc. has a total annual cash requirement of P9,075,000 which are to be paid uniformly.…
A: Since you have posted a multipart question therefore we will solve the first three parts only.…
Q: Buccaneer, Inc., has determined that it needs $10 million in cash per week. If Buccaneer needs…
A: Demand=10000000 Cost per infusion=100 holding cost=0.2/100 =0.002
Q: A firm needs a total P30 million in new cash for transaction purposes. The annual interest rate on…
A: New cash needed (C) = P 30 million r = 12% Fixed cost (F) = P 1000
Q: The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can…
A: C=Optimum cash balance which will minimize its total cost A=Requirement of month=5000000…
Q: dbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell…
A: To determine the transactions costs (per month) associated with the cash infusions we first need to…
Q: ation of its cash outlay required indicates that it needs P50,000 for the year. The marketable…
A: There are two cost related to cash one is holding cost and other is ordering cost and both…
Q: Dome Metals has credit sales of $450,000 yearly with credit terms of net 45 days, which is also the…
A: Credit management is considered to be important part. Discount are offered in order to receive…
Q: Data on Nathan Enterprises has determined that it needs Php 7.8 million in cash per week. If Data on…
A: EOQ- Economic Order Quantity is the analysis tool which helps to determine the ideal order quantity…
Q: The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can…
A: To determine the transactions costs (per month) associated the cash infusions we first need to…
Q: Watts Industries' carries 87 days in Inventory, and collects its Accounts Receivable in 75 days. If…
A: The cash conversion cycle is the number of days required for the cash invested in inventory to be…
Q: Hollywood Shoes would like to maintain their cash account at a minimum level of $67,000, but expect…
A: Given: cash account at a minimum level of $67,000 net daily cash flows to be $5,700 marketable…
Q: Green Corporation anticipates a cash requirement of P1,500 over a 1- month period. It is expected…
A: The question is based on the concept of Financial Management.
Q: A firm has daily cash receipts of P100,000. A bank has offered to reduce the collection time on the…
A: Daily cash receipts = P 100000 Reduction in collection time (n) = 3 days Monthly fee = P 500 r = 5%
Q: It is assumed that the Cost of equity and rate of return are both constant under Walter’s Model of…
A: Since you have asked multiple questions, we will solve only one question for you as per Bartleby's…
Q: A business plans to use £20,000 of cash during the forthcoming year. It holds most of its cash in a…
A: Given the following information: Planned payments for the forthcoming time period: $20,000 Cost of…
Q: Dome Metals has credit sales of $162,000 yearly with credit terms of net 30 days, which is also the…
A: Firm often make strategies to collect account receivables outstanding balance at an early point of…
Q: WOPPERS PLC, which currently has negligible cash holdings, expects to have to make a series of cash…
A: The term optimal cash balance is defined by Baumol and is commonly known as the Baumol Model which…
Q: National Co. has a total annual cash requirement of P9,030,000 which are to be paid uniformly.…
A: The question is related to Baumol Cash model. The optimum cosh conversion size is calculated with…
Q: The following table includes quarterly working capital levels for your firm for the next year.…
A: INTRODUCTION Working capital: The distinction among a company's actual assets, such as funds,…
Q: ATIQ, a small global jewellery and crafts marketing company, is beginning to expand into other…
A: EOQ stands for Economic Order Quantity that indicates the quantity of inventory units to be ordered…
Q: American Products is concerned about managing cash efficiently. On average, inventories have an age…
A: According to the rule, we will only answer the first three subparts, for the remaining subparts,…
Simile Inc. has a total annual cash requirement of P9,075,000 which are to be paid uniformly. Simile has the opportunity to invest the money at 24% per annum. The company spends, on the average, P40 for every cash conversion to marketable securities.
What is the Total
Step by step
Solved in 2 steps with 2 images
- Buccaneer, Inc., has determined that it needs $10 million in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. 1. How much is the weekly opportunity cost of cash? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) * 2. How much is the total demand for cash per week? (Use a number, no decimal value, no commas, no currency, no space) *The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. 1. If Sandbox gets a cash infusion of P1 million each time it needs cash, how much would be the average cash balance associated with its cash investment? 2. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the total costs per month associated its cash infusions?The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the holding costs associated with its cash investment?
- A firm needs a total P30 million in new cash for transaction purposes. The annual interest rate on marketable securities is 12% and the brokerage fee cost per transaction of selling securities to replenish cash is P1,000. Which of the following is closest to the firm’s optimal average cash balance?The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the transactions costs per month associated its cash infusions?mekmek Corporation uses the Baumol Cash Model to determine its optimal cash balance. For the coming year, the expected cash disbursement total to P432,000. The interest rate on marketable securities is P8 per transaction. Using 5% carrying cost rate, what is the optimal cash balance of the company? A. 1,175.76 B. 5,878.78 C. 11,757.55 D. 142,000
- Buccaneer, Inc., has determined that it needs $10,000,000 in cash per week. If Buccaneer needs additional cash, it can sell marketable securities, incurring a fee of $100 for each transaction. If Buccaneer leaves funds in its marketable securities, it expects to earn approximately 0.2% per week on their investment. Using the economic order quant ity model, how much cash should Buccaneer raise from selling securities each week to minimize its costs of cash?The Real Company has cash needs of P5 million per month. If real needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If real leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. If real gets a cash infusion of P1 million each time it needs cash, what are the total costs per month associated its cash infusions? If real gets a cash infusion of P1 million each time it needs cash, how many transactions would be associated with its cash investment? If real gets a cash infusion of P1 million each time it needs cash, what are the transactions costs per month associated its cash infusions? how much would be the real's minimum total costs associated with cash infusion? If realgets a cash infusion of P1 million each time it needs cash, how much would be the average cash balance associated with its cash investment? If real gets a cash infusion of P1 million each time it needs cash, what are…Ekrita’s evaluation of its cash outlay required indicates that it needs 200,000 for the year. Regardless, of the amount. It incurs 50 to convert Marketable Securities to Cash. The Marketable Securities earn an annual rate of 5%. Lemon does not maintain buffer cash. How much is the Optimal Transaction Size? How much is the Annual Holding Cost as a result of keeping Cash in Bank? How much is the Total Annual Cost of Cash?
- The following formula is used in determining its optimal level of cash. Assume that the fixed cost of selling marketable securities is P10 per transaction and the interest rate on marketable securities is 6% per year. The company estimates that it will make cash payments of P12,000 over a 1-month period. What is the average cash balance (rounded to the nearest peso)? (check the attached photo) choose the letter of the correct answer a. P1,732.00b. P3,464.00c. P6,928.00d. P8,660.00e. P15,588.00The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. 1. Using the Baumol model, how much would be the Sandbox’s minimum total costs associated with cash infusion? 2. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the holding costs associated with its cash investment? 3. Using the Baumol model, what level of cash infusion minimizes Sandbox’s costs associated with cash?The Sandbox's Company has cash needs of P5 million per month. If Sandbox needs more cash, it can sell marketable securities, incurring a fee of P300 for each transaction. If Sandbox leaves its funds in marketable securities, it expects to earn approximately 0.50% per month on their investment. 1. If Sandbox gets a cash infusion of P1 million each time it needs cash, what are the transactions costs per month associated its cash infusions? 2. If Sandbox gets a cash infusion of P1 million each time it needs cash, how many transactions would be associated with its cash investment?
