What will be optimal cash return point

Assignment Help Financial Management
Reference no: EM131358504

HotFoot Shoes would like to maintain its cash account at a minimum level of $28,000, but expects the standard deviation in net daily cash flows to be $4,300, the effective annual rate on marketable securities to be 6.8 percent per year, and the trading cost per sale or purchase of marketable securities to be $230 per transaction. What will be its optimal cash return point? (Use 365 days a year. Do not round intermediate calculations and round your answer to 2 decimal places.)

Reference no: EM131358504

Questions Cloud

Explains why the standard deviation of the portfolio : Which fo the following facts explains why the standard deviation of the portfolio is less than the standard deviation of either of the two stocks that make up the portfolio?
Characteristics of a business negotiation : Write 6 reports about the characteristics of a business negotiation. they may have the same idea, but they should be written in different ways. Each report to be 500 words. NO copy material from internet sources or student paper will be accepted. ..
Compute the present value of the minimum lease payments : 422/acc- Compute the present value of the minimum lease payments. Prepare all necessary journal entries for Bonita for this lease through January 1, 2018.
Businesses that are not ecommerce companies : What role does IT play in small businesses that are not ecommerce companies? Do brick and mortar companies need IT just as much as ebusinesses?
What will be optimal cash return point : HotFoot Shoes would like to maintain its cash account at a minimum level of $28,000, but expects the standard deviation in net daily cash flows to be $4,300, the effective annual rate on marketable securities to be 6.8 percent per year, and the tradi..
What will be firm cash cycle : Suppose that Ken-Z Art Gallery has annual sales of $894,000, cost of goods sold of $584,000, average inventories of $170,000, average accounts receivable of $139,000, and an average accounts payable balance of $64,000. Assuming that all of Ken-Z’s sa..
Calculate the load and resistance factors : Calculate the load and resistance factors for a reliability of 99% when the strength has a mean value of 65.4 MPa and COV 22%; the stress has a mean value 32.7 MPA and COV 11%.
Manufacturer of bottled water : Fountain Plus, Inc. a manufacturer of bottled water, has enjoyed rapid growth in sales of one of its flavored water products, Xtrafresh, for which it has a patent, which has just expired. It now faces fierce competition from a number of other bott..
Design a cylindrical pressure vessel with diameter : Design a cylindrical pressure vessel with diameter d = 4 m, internal pressure p = 3.0 MP a, with a COV Cp = 0.10 to achieve a reliability Re = 0.95 with respect to the burst pressure.

Reviews

Write a Review

Financial Management Questions & Answers

  Whats lowest price that you would consider selling it for

You are building a pipeline which will generate its first annual cash flow of $2m exactly 5 years from today. As it ages, the volume it transports, and hence the cash flows it creates, will decline by 3% per year. Exactly 27 years from today, this pi..

  Prepare statement of retained earnings for the year

Retained Earnings Statement Rolt Company began 2013 with a $135,000 balance in retained earnings. During the year, the following events occurred: The company earned net income of $85,000. A material error in net income from a previous period was corr..

  Accounts would costs be recorded on financial statements

A job was started on May 15, completed on June 27, and delivered to the customer on July 6. In which accounts would the costs be recorded on the financial statements dated May 31, June 30 and July 31?

  In 1930 the highest paid player in major league baseball

1 in 1930 the highest paid player in major league baseball was babe ruth of the new york yankees with an annual salary

  Compute the indirect quote for the rand rupee and yen

What does the evidence in Table 2.3 indicate about the expected future value of the Euro relative to the dollar? Compute the indirect quote for the rand, rupee, and yen as of March 9, 2010. (Refer to Table 2.1.)

  Determine the amount that the market price of companys stock

Determine the amount that the market price of the company's stock is expected to drop on the ex-rights date, assuming that all other things are equal.

  Would you implement either of these options the company

During 2015, Spartan Systems reported total sales of $300,000, at a price of $20 and per unit variable expenses of $12, for the sales of their single product. Improve the product quality which will increase direct material cost per unit by $2 ii. Inv..

  What range of stock prices at maturity

Three call options on a stock have the same expiration date and strike prices of $20, $25, and $30. The market prices are $8, $4, and $1, respectively. Explain how a butterfly spread can be created. Construct a table showing the profit from the strat..

  What do investors expect stock to sell for at end of year

A share of stock is now selling for $155. It will pay a dividend of $6 per share at the end of the year. Its beta is 1. What do investors expect the stock to sell for at the end of the year? Assume the risk-free rate is 5% and the expected rate of re..

  Which policymakers was romer referring to

Which policymakers was Romer referring to? Briefly explain why the government's spending more and taxing less increases aggregate demand.

  Calculate cash flow from operating activities

Given the following selected information on Cicalese’s Chocolate, Inc., calculate Cash Flow from Operating Activities for the year 20X1.

  Discuss the four types of economic systems

Define and discuss the four types of economic systems.  Give examples of countries that utilize these systems. Explain the possible effects of the systems upon the business environment in the countries you chose.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd