Setting of optimal cash balance, Finance Basics

Assignment Help:

Setting of Optimal Cash Balance

Cash is often identified like a non-earning asset since holding cash quite than a revenue-generating asset includes a cost in form of foregone interest.  Therefore the firm must hold the cash balance which will enable it to meet its scheduled payments like they fall due and give a margin for safety.  So there are several techniques used to find out the optimal cash balance.  These are like:

The Cash Budget

The Cash Budget confirms the firm's projected cash outflows and inflows over some particular period. This technique has already been discussed in another earlier course.  However the student must revise the cash budget.


Related Discussions:- Setting of optimal cash balance

Income statement-balance sheet and cash flow, Looking at the income stateme...

Looking at the income statement, balance sheet and cash flow statement of the company and relating it with the non financial factors, I have the important observations as below:-

Calculate the retrospective gross premium reserve, Question: A deferred...

Question: A deferred annuity policy is sold to a life aged 45 with the following benefits: • Basic payments start at $30,000 from age 65, increasing by $2,000 each year; •

Financial and Operational Hedging, There are four different commonly used f...

There are four different commonly used financial hedging techniques and some operational hedging techniques that firms use to manage currency risk. Drawing on literature, critical

What are potential solutions, Internal finance can avoid the agency costs o...

Internal finance can avoid the agency costs of debt and equity finance. In practice it is the most important source of funding. (a) Discuss potential problems of internal financ

Incentive problem and consumption of perquisites, Incentive Problem and Con...

Incentive Problem and Consumption of Perquisites Incentive Problem Managers may have fixed salary and they may have no incentive to work hard and maximize shareholders weal

Calculate operating leverage of tax rate, A firm has sales of Rs. 10,00,000...

A firm has sales of Rs. 10,00,000. Variable cost is 70%, total cost is Rs.9,00,000 and Debt of Rs. 5,00,000 at 10% rate of interest. If tax rate is 40% calculate:

Stock exchange market, Stock Exchange Market The Idea and improvemen...

Stock Exchange Market The Idea and improvement of a Stock Exchange Stock exchange also identified as stock markets are special "market places" whereas already held bond

Important points for capital market authority, Important Points for Capital...

Important Points for Capital Market Authority Apart from the above roles, CMA can assume the given steps to encourage progress of stock exchanges in US or other countries.

Explain the term - giving margin money to broker, Explain the Giving Margi...

Explain the Giving Margin Money to Broker Marin  is  the  amount  of  money  which is provided  by customer to the brokers who have agreed to trade their securities. It may

Write Your Message!

Captcha
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