Question

Hofsteder Inc. is a clothes retailer. It holds a sum of $10,000 in its bank account...

Hofsteder Inc. is a clothes retailer. It holds a sum of $10,000 in its bank account on a daily basis in order to pay its suppliers. This is an example of the ________ motive for liquidity.

Cautionary.

Traditional.

Speculative.

Precautionary.

Transaction.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Transaction motive for liquidity

Liquidity refers as having the cash and cash equivalent to meet operating Expenses which means available of cash to meet short term Expenses.

Transaction motive: it's refers as Holding the cash balances or balances in savings or current account for meet day to day to transaction. It depends on level of income and gap between the income and expenses

Businessman hold the balance on their hands to meet the day to day business expenditures.

For an example: Paying rent , wages, material purchase and pay it's supplier.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
lota Inc, an electronics retailer, just finished its first year of operations and is in the...
lota Inc, an electronics retailer, just finished its first year of operations and is in the process of preparing its December 31, 2018 balance sheet. indicate that the account names and dollar amount If any) that lota would report within the current and long-term liabilities sections of its balance sheet at December 31, 2018 as a result of each transaction described below. If no liability should be recorded leave the item blank. Question 1. 1a) On October 1, 2018 lota...
lota Inc, an electronics retailer, just finished its first year of operations and is in the...
lota Inc, an electronics retailer, just finished its first year of operations and is in the process of preparing its December 31, 2018 balance sheet. indicate that the account names and dollar amount If any) that lota would report within the current and long-term liabilities sections of its balance sheet at December 31, 2018 as a result of each transaction described below. If no liability should be recorded leave the item blank. Question 1. 1a) On October 1, 2018 lota...
5-1 FUTURE VALUE If you deposit $10,000 in a bank account that pays 10% interest annually,...
5-1 FUTURE VALUE If you deposit $10,000 in a bank account that pays 10% interest annually, how much will be in your account after 5 years? 5-2 PRESENT VALUE What is the present value of a security that will pay $5,000 in 20 years if securities of equal risk pay 7% annually? 5-3 FINDING THE REQUIRED INTEREST RATE Your parents will retire in 18 years. They currently have $250,000, and they think they will need $1,000,000 at retirement. What annual...
10. Scott takes $10,000 from his bank account to set up a small donut-shop business. He...
10. Scott takes $10,000 from his bank account to set up a small donut-shop business. He meets with an attorney, and finds out he can set up a sole proprietorship for under $100, but a corporation would cost over $500 ($175 to the state, about $400 to the attorney). He decides on a sole proprietorship. He signs a one-year lease, and starts his business. After six months of operations, he closes the business because of much-lower-than-expected sales. After using the...
Bobcat Coffee had sales of goods totaling $200,000, receiving $150,000 in cash and $50,000 on account....
Bobcat Coffee had sales of goods totaling $200,000, receiving $150,000 in cash and $50,000 on account. The cost of the goods sold were $60,000. Bobcat Coffee purchased $80,000 of inventory. All purchases were on account. Bobcat Coffee paid salaries of $50,000. This was payment for salaries of $35,000 and $15,000 that was payable from last year. Bobcat Coffee purchased $7,000 of supplies. All of these purchases were on account. Bobcat Coffee received $40,000 cash from customers who had been granted...
COST ACCOUNTING Gizmos, Inc. incorporated and will begin operations on January 1, 2021. Its primary business...
COST ACCOUNTING Gizmos, Inc. incorporated and will begin operations on January 1, 2021. Its primary business is the manufacture and sale of gadgets. Because cash resources are limited, the company anticipates the need to have access to capital during the first year of operations and seeks to establish a line of credit with a local bank. The bank requires a complete operating and cash budget and pro-forma financial statements for 2021 as part of the loan application. The following information...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to develop a “study pillow” which will allow students to upload study material into their brain whilst sleeping. However, Large Mart has recently discovered that an American company called Bpple already holds a patent for this type of device. As a result, Large Mart has given up on its development attempts and decided to sell the Bpple product, which is called iSLEEP. In order to...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to develop a “study pillow” which will allow students to upload study material into their brain whilst sleeping. However, Large Mart has recently discovered that an American company called Bpple already holds a patent for this type of device. As a result, Large Mart has given up on its development attempts and decided to sell the Bpple product, which is called iSLEEP. In order to...
1. It is time for Jung So Min Corp. to begin its annual budget preparation for...
1. It is time for Jung So Min Corp. to begin its annual budget preparation for its upcoming fiscal year, which ends on December 31, 2021. They are in need of temporary assistance in their accounting office, and have hired you to carry out the task of preparing the budgets. Jung So Min prepares quarterly budgets, and then from this information prepares an annual budget. To assist you in this task, Jung So Min has gathered the following information: 1)...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to...
In its ongoing efforts to make the student life easier, Large Mart is currently attempting to develop a “study pillow” which will allow students to upload study material into their brain whilst sleeping. However, Large Mart has recently discovered that an American company called Bpple already holds a patent for this type of device. As a result, Large Mart has given up on its development attempts and decided to sell the Bpple product, which is called iSLEEP. In order to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT