Asked by Andrea Anguiano on Jul 06, 2024
Verified
When Jane balanced her checkbook, she had an adjusted bank balance of $4,640. She had 3 outstanding deposits worth $1,000 each and 5 checks outstanding with a total value of $2,300. What is the amount of the collection float on Jane's account?
A) $2,300
B) $3,000
C) $3,640
D) $9,860
E) $11,500
Collection Float
Collection Float refers to the time delay between when a check is deposited into a bank account and when the amount is actually available for use.
Outstanding Deposits
The total amount of money deposited in a financial institution that has not yet been credited to the depositor's account.
Checks
Written, dated, and signed instruments that direct a bank to pay a specific sum of money to the bearer or to a specified person.
- Gain an understanding of how collection and disbursement floats influence a company's management of cash.
- Evaluate the present and net present valuation of the float in different situations.
Verified Answer
Learning Objectives
- Gain an understanding of how collection and disbursement floats influence a company's management of cash.
- Evaluate the present and net present valuation of the float in different situations.
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