A Services Firm Does All Its Business in Cash Only

question 58

Multiple Choice

A services firm does all its business in cash only. The firm projects a cash balance of $4,000 in its account after all taxes and costs are paid. The owners plan to invest $7,000 and pay a dividend of $1,000. How much net new financing is needed?

• A) $4,000
• B) $5,000
• C) $6,000
• D) $7,000

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Definitions:

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