1. Hollywood Shoes would like to maintain their cash account at a minimum level of $67,000, but expect the standard deviation in net daily cash flows to be $5,700; the effective annual rate on marketable securities to be 6.50 percent per year; and the trading cost per sale or purchase of marketable securities to be $270 per transaction. What will be their optimal cash return point? (Round your answer to 2 decimal places.)

$87,045.38

$72,700.00

$90,773.71

$100,657.93

2. Ending finished goods inventory in a single product company equals the number of units in ending inventory less the number of units in beginning inventory, multiplied by their unit product cost.

True

False