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Q. Objectives of Cash Management?
(i) To sustain Optimum Cash Balance: - The major objective of cash management is to determine the optimum cash balance required in the business and to maintain the cash balance at that level. It is essential to bring equilibrium between liquidity as well as profitability of business to determine the optimum cash balance.
(ii) To keep the most favourable cash balance requirement at minimum level: - The second major objective of cash management is to minimize the optimum cash requirement for the reason that cash is a non-earning asset.
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