Finance

The Solar Inc has daily cash receipts of $90,000. A recent analysis of

The Solar Inc has daily cash receipts of $90,000. A recent analysis of its collections indicated that customers’ payments were in the mail for an average of 4 days. Once received,the payments are processed in one and a half days. After payments are deposited, it takes an average of two and a half days for […]

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Date: September 19th, 2020

Which of the following is true of collection float? A) It represents

Which of the following is true of collection float? A) It represents the time delay between when payment is placed in the mail and when it is received. B) It represents the time between receipt of a payment and its deposit into a firm’s account. C) It results from the lapse between the time when […]

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Date: September 19th, 2020

The higher yields on Eurodollar deposits compared with nearly all othe

The higher yields on Eurodollar deposits compared with nearly all other marketable securities, governmental or nongovernmental, with similar maturities are attributable to 1. the fact that the depository banks are generally less closely regulated than U.S. banks and are therefore more risky, and 2. some foreign exchange risk may be present. Indicate whether the statement […]

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Date: September 19th, 2020

A customer sends payment to a post office box which is emptied by a fi

A customer sends payment to a post office box which is emptied by a firm’s bank daily. The bank then processes the payments and notifies the firm of the day’s collections. This collection technique is known as ________. A) a direct send B) concentration banking C) the lockbox system D) controlled disbursing     ANSWER […]

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Date: September 19th, 2020

Why is it true that the hypothesis that the forward exchange rate is a

Why is it true that the hypothesis that the forward exchange rate is an unbiased predictor of the future spot exchange rate is equivalent to the hypothesis that the forward premium (or discount) on a foreign currency is an unbiased predictor of the rate of its appreciation (or depreciation)?     ANSWER Answer: When the […]

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Date: September 19th, 2020