Asked by Julio Cesar Meirelles on Jul 07, 2024
Verified
Which of the following correctly describes average daily float?
A) Average daily receipts + Weighted average delay x Opportunity rate.
B) Average daily receipts x Weighted average delay.
C) Total receipts/Total days.
D) Weighted average delay - Average daily receipts.
E) Total float x Total days.
Average Daily Float
The average amount of uncollected funds represented by checks in the process of clearing, typically used in banking and finance to assess cash management efficiency.
Total Float
The total amount of time that a project task can be delayed without causing a delay to the project's completion date.
- Understand the concept and calculation of float in financial management.
Verified Answer
JD
Jenna DonaldJul 08, 2024
Final Answer :
B
Explanation :
Average daily float is calculated by multiplying the average daily receipts by the weighted average delay, representing the average amount of time it takes for checks or other transactions to clear and become available as usable funds.
Learning Objectives
- Understand the concept and calculation of float in financial management.