1.
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Yesterday, the president of RB Enterprises received a phone call from DLK, a competitor. DLK is a sole proprietorship. An unexpected family situation has caused the owner to suddenly want to retire and relocate closer to his family. Thus, the assets of DLK are being offered to RB Enterprises at a bargain basement price. While RB Enterprises had not anticipated purchasing these assets, it was decided that the opportunity was too good to pass up. This illustrates which of the following needs to hold cash?
Refer to section 19.1
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2.
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GT Motors regularly issues short-term debt to finance its daily operations. Suddenly, the credit markets froze and no funds were available for borrowing. Fortunately, the firm had some cash reserves saved that it was able to use to fund its operations until additional credit was available. The need to retain cash for situations such as this is referred to as which one of the following motives for holding cash?
Refer to section 19.1
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3.
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The cash found in a cash drawer that a check-out clerk uses to make change is an example of which of the following motives for holding cash?
Refer to section 19.1
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4.
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Float is defined as the:
Refer to section 19.2
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5.
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A lockbox is a:
Refer to section 19.3
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