Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Each business day, on average, a company writes checks totaling $12,300 to pay its suppliers. The usual clearing time for the checks is four days.
Each business day, on average, a company writes checks totaling $12,300 to pay its suppliers. The usual clearing time for the checks is four days. Meanwhile, the company is receiving payments from its customers each day, in the form of checks, totaling $23,300. The cash from the payments is available to the firm after two days. a. Calculate the company's disbursement float, collection float, and net float. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) b. If the collected funds were available in one day instead of two, what would be the company's disbursement float, collection float, and net float? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started