The financial manager of a firm does not maintain a ledger balance but refers to the bank balance as it appears online to determine the amount of funds in the firm's checking account. What is the financial manager ignoring?
A) Bank fees
B) Direct deposits
C) Float
D)Customer checks returned for insufficient funds

Question

Quizplus · Accepted Answer

The financial manager is ignoring float, which is the time delay between when a deposit is made and when it actually becomes available in the checking account. This can lead to inaccuracies in knowing the true amount of available funds in the account. Bank fees, direct deposits, and customer checks returned for insufficient funds would all be reflected in the online bank balance.

The Financial Manager of a Firm Does Not Maintain a Ledger