Accounting

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Lock boxes Anne teak, The finanicial manager of the furniture manufactures, is considering operating a lock box system. she forcasts that 400 payments a day will be made to lock boxes with an average payment size of $2000. The bank charge for operating the lock boxes is $.40 a check. The interest rate is 0.15 percent per day.
A) If the lock box saves 2 days in collection float, is it worthwhile to adopt the system?
b) What minimum reduction in the time to collect and process each check is needed to justify use of the lock box system?


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