Anne Teak, the financial manager of a furniture manufacturer, is

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Anne Teak, the financial manager of a furniture manufacturer, is considering operating a l

Anne Teak, the financial manager of a furniture manufacturer, is considering operating a lock-box system. She forecasts that 700 payments a day will be made to lock boxes with an average payment size of $2,500. The bankAc€?cs charge for operating the lock boxes is $.40 a check. The interest rate is .013% per day.

a-1.

If the lock box makes the cash available 2 days earlier, calculate the net daily advantage of the system. (Do not round intermediate calculations.)

Daily interest saved

a-2.

Is it worthwhile to adopt the system?

	Yes
	No

b.	What minimum reduction in the time to collect and process each check is needed to justify use of the lock-box system? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Minimum reduction in time

days

Abhinav 02-Dec-2019

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Anne Teak, the financial manager of a furniture manufacturer, is considering operating a l

Anne Teak, the financial manager of a furniture manufacturer, is considering operating a l

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