Century Corporation uses a continuous billing system that results in average dialy receipts of $600,000. The company treasurer estimates that a proposed lock-box system could reduce its collection time by 2 days.

a. How much cash would the lock-box system free up for the company?

b. What is the maximum amount that Century Corp. would be willing to pay for the lock-box system?

c. If the lock-box system could be arranged at an annual cost of $40,000, what would the net gain from instituting the lock-box system be?

  1. 👍
  2. 👎
  3. 👁

Respond to this Question

First Name

Your Response

Similar Questions

  1. accounting

    Fill in the blanks in the following separate income statements a through e. Identify any negative amount by putting it in parentheses. a b c d e Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $60,000

  2. math, depreciation

    A workcenter system purchased at a cost of $60,000 in 2015 has a scrap value of $12,000 at the end of 4 years. If the straight-line method of depreciation is used. a) find the rate of depreciation. b) Find the linear equation

  3. Math

    I need help I've been trying to solve this problem for 3 days and still no results. I know how to solve the problem when the level starts from 1-17600 but what do i do if it is starting from 9100-17600 what do i subtract from to

  4. Physics

    1) The annoying sound from a mosquito is produced when it beats its wings at the average rate of 600 wingbeats per second. What is the frequency of the sound wave? 1/600 1/300 300 600 My answer was 1/600 but this was wrong.

  1. Cost accounting

    Gary corporation has developed the following flexible budget formula for monthly overhead: for output of les than 200,000 units: $36,600 + $80 (units) for output of 200,000 units or more: $43,000+$80 (units), How much overhead

  2. Accounting

    Imagen Arquitectonica of Tijuana, Mexico is contemplating a major change in its cost structure. Currently, all of its drafting work is performed by skilled draftsmen. Alfredo Ayala, Imagen's owner, is considering replacing the

  3. Math

    Imagine that you have the following credit card statement for the period ending 9-25-20. You credit card's APR is 24%. Range Balance (purchases/payments #days 8/26 to 8/30 $3000 5 8/31 to 9/11 $3147.58 12 9/12 to 9/18 $3197.58 7

  4. accounting

    XYZ's receivables turnover is 10x. The accounts receivable at year-end are $600,000. The average collection period is 90 days (3 months). What was the sales figure for the year? A) $60,000 B) $6,000,000 C) $24,000,000 D) none of

  1. Accounting

    Rita forms Finch Corporation by transferring land (basis of 125,000; fair market value of 750,000) which is subject to a mortgage of 375,000. Two weeks prior to incorporating Finch, Rita borrows 125,000 for personal purposes and

  2. Annuity math

    The city of Toronto’s population rose from 2,000,000 to 4,500,000 in the last twenty years of the twentieth century. What was the annual average percentage increase in population for that period?

  3. calculus

    The salaries at a corporation are normally distributed with an average salary of $29,000 and a standard deviation of $4,000. Sixteen percent of the employees make more than Sara. What is Sara's salary? Round your answer to the

  4. Math

    Rainbow Harbor Cruises charges $16/adult and $8/child for a round-trip ticket. The records show that, on a certain weekend, 900 took the cruise on Saturday and 600 took the cruise on Sunday. The total receipts for Saturday were

You can view more similar questions or ask a new question.