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Unformatted text preview: is not effective in evaluating performance. The nature of the business affects the decision of the amount of cash to keep on hand. The example used above of a hotel is a good example to use in this instance as well. Most hotels have high seasons and low seasons depending on where they are located. One would not need to keep as much cash on hand during the low season as would be needed for the high season. A company where I was previously employed provided care and service to mentally handicapped people. During the summer months it was necessary to keep more cash on hand for vacation activities. During the winter months few activities took place due to the weather. This was taken into account when preparing the budget for the year....
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This note was uploaded on 02/16/2012 for the course ACCOUNTING ACC561 taught by Professor Jardine during the Spring '12 term at University of Phoenix.
- Spring '12