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Eddi Din [679]
3 years ago
7

Excess cash is cash that is excess to the operations of a company and is considered "negative debt" because the cash could be us

ed to reduce debt. Therefore, there is a cost to excess cash, especially if not reinvested or returned to investors as dividends. True or false?
Business
2 answers:
Harrizon [31]3 years ago
6 0

Answer:

True

Explanation:

Excess cash is a term used in the for the residual cash flow of operation. It is calculated after adding the non cash expenses in the net income of the company and deducting all the capital expenditures. This is the cash balance which is available for the reinvestment purpose and for distribution to the stockholders. This cash can also be used to reduce the gearing of the company and there is a cost attached to it if used for payment of loan, which is the rate or return from the reinvestment of these cash flows.

babunello [35]3 years ago
5 0

Answer:

The correct answer is "True"

Explanation:

Any company at one point or the other can have excess cash.  In order to know if the company is having excess cash, the company's expenditure is deducted from it's net income.

After the calculation, the excess cash obtained should be reinvested or it should be returned to investors as dividends.  It could also be used to pay debt.  No excess cash should be kept idle for a long period of time.

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On December 31 of the current year, Plunkett Company reported an ending inventory balance of $215,500. The following additional
marishachu [46]

Answer:

The amount that Plunkett should report in ending inventory on December 31 is $156,300

Explanation:

The computation of the ending inventory is shown below:

= Ending inventory balance - FOB destination goods purchased - goods being held on consignment

= $215,500 - $44,100 - $15,100

= $156,300

The other items would not be adjusted because the other items are not included in the ending inventory so they are not being considered in the computation part.

5 0
4 years ago
Bengal Co. provides the following unit sales forecast for the next three months: July August September Sales units 4,800 5,500 5
alexgriva [62]

Answer: 4,975 units

Explanation:

Budgeted production in July = Sales forecast for July + Ending inventory for July - Beginning inventory

Beginning inventory = 25% of July sales

= 25% * 4,800

= 1,200 units

Ending inventory = 25% of August sales

= 25% * 5,500

= 1,375 units

Budgeted production is therefore:

= 4,800 + 1,375 - 1,200

= 4,975 units

5 0
3 years ago
Riley Market, Newton Grocers, and Barlow Pantry are grocery stores. During physical inventory, Riley remains fully open, while N
Svet_ta [14]

Answer: Newton Grocers

Explanation: Riley Market, Newton Grocers, and Barlow Pantry are grocery stores. During physical inventory, Riley remains fully open, while Newton closes until the count is complete. Barlow falls between the others, selling only a small selection of essential items such as milk and bread during inventory. Newton Grocers would have the most accurate inventory because Newton doesn't close until the count is complete.

5 0
3 years ago
In an effort to reduce cost on auto insurance, Sophia has lowered each component of her current plan to the cheapest possible op
MAXImum [283]

Answer:

Sophia will save $38.15

Explanation:

If Sophia chooses the cheapest possible option, her choices will be:

bodily injury                        $25/50,000                   $21.35

property damage                 $25,000                      $115.50

collision                           $500 deductible            $248.08

<u>comprehensive               $100 deductible               $88.23  </u>

total premium                                                           $473.16

she will save $511.31 - $473.16 = $38.15

5 0
3 years ago
Your friend offers you a pencil or a t-shirt for your iced coffee. You choose the t-shirt because it has the highest
vlabodo [156]
Value ! From my understanding.
7 0
3 years ago
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