On an average day,DDL Enterprises writes checks totalling $1,500.These checks take an average of 5 days to clear.On an average day,DDL receives checks totalling $1,700 which take 4 days to clear.The cost of debt is 7.5 percent.What is the firm's disbursement float?

Question

Quizplus · Accepted Answer

The disbursement float is calculated as the total amount of checks written daily ($1,500) multiplied by the number of days it takes for these checks to clear (5 days). Therefore, the disbursement float is $1,500 * 5 = $7,500.

On an Average Day,DDL Enterprises Writes Checks Totalling $1,500