The big management reporting challenge: Cash management

Posted by PM | on Fri, 27/08/2010 - 08:55  1589  1 comment

Take the latest test from CIMA for a chance to win a bottle of wine.

This week, the Chartered Institute of Management Accountants (CIMA) has sent us a question on cash management (see below). As usual, post your answers as comments below and we'll add to the thread with the correct answer in due course. The member that gives us the best answer will win a bottle of wine.

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brianheg | Fri, 27/08/2010 - 14:08 | Permalink

Spread = 3 * [(3/4 * $30 * $300,000 / 0.025%) ^ (1/3)] = $9,000

Upper Limit = Lower Limit + Spread = $2,500 + $9,000 = $11,500

Return Point = Lower Limit + (1/3 * Spread) = $2,500 + $3,000 = $5,500