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CTP · Question #357
CTP Question #357: Real Exam Question with Answer & Explanation
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Question
- (Topic 4) A cash manager at a U.S. retailer forecasts a positive collected cash position for the end of the current day. The company has an overdraft facility at 10%, a separate investment account earning 8% before taxes, an earnings credit rate of 8% and an outstanding single payment note at9.5% maturing in 1 week. This month's bank service fees are expected to exceed the earnings credit. Which of the following options would be the MOST economically positive for the company?
Options
- ALeave the funds in the account.
- BRedeem the single payment note.
- CPrepay administrative expenses.
- DTransfer funds to the investment account.
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