The Can-Do Company Operates 365 Days a Year

question 304

Multiple Choice

The Can-Do Company operates 365 days a year. The average cash outflow is $250 a day. The fixed cost of replenishing the cash account is $12 a transaction. The interest rate is 4%. What is the
Optimal initial cash balance?

• A) $2,136
• B) $5,232
• C) $6,809
• D) $7,399
• E) $7,822

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Definitions:

Ceases to Be a Partner

Occurs when an individual no longer holds the status of a partner in a partnership, possibly due to withdrawal, expulsion, or agreement termination.

General Partner

A type of owner in a partnership who is responsible for the operations of the company and is liable for its debts.

Statutory Provisions

Laws or regulations enacted by a legislative body that must be followed by individuals and entities subject to its jurisdiction.

Safe Harbor Provisions

Legal provisions that provide protection from liability under certain conditions, often seen in regulatory contexts.