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The Normal Sequence of the Physical Examination Should Be

question 15

Multiple Choice

The normal sequence of the physical examination should be

Recognize the costs associated with holding too little or too much cash, and the role of money market instruments in liquidity management.
Learn the effects of environmental factors on float management.
Understand the calculations involved in determining net float and the implications for cash management.
Understand methods to decrease a firm’s collection time.

Definitions:

Preferred Stock

A class of ownership in a corporation with a priority claim on assets and earnings before common stock; typically does not have voting rights but has a fixed dividend.

Capital Stock

The total amount of stock, both common and preferred, that a company is authorized to issue according to its corporate charter.

Privately Held Corporation

A corporation that has only a few stockholders and whose stock is not available for sale to the general public.

Retained Earnings

The portion of a company's net income that is not distributed as dividends to shareholders but retained for reinvestment in the business or to pay off debt.

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