What will be their optimal cash return point

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Reference no: EM131937246

1. Hollywood Shoes would like to maintain their cash account at a minimum level of $55,000, but expect the standard deviation in net daily cash flows to be $4,500; the effective annual rate on marketable securities to be 6.00 percent per year; and the trading cost per sale or purchase of marketable securities to be $150 per transaction. What will be their optimal cash return point? (Round your answer to 2 decimal places.)

$76,695.98

$59,500.00

$79,254.89

$79,382.73

2. Mission Corp. borrowed $50,000 cash on April 1, 2016, and signed a one-year 12%, interest-bearing note payable. The interest and principal are both due on March 31, 2017.

The amount of interest expense for the year ended December 31, 2016 is:

$4,500.

$6,000.

$4,000.

$1,500.

Reference no: EM131937246

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