General Products writes checks that average $20,000 daily. These checks take an average of 6 days to clear. It receives payments that average $22,000 daily. It takes 3 days before these checks are available to the firm. What would be General Products' annual savings if it could obtain access to the payments it receives within 2 days? The interest rate is 6% per year.

Transcribed Image Text:

Average payment made Average days to clear the check Average payment received Availability float S20,000.00 6.00 days $22,000.00 3.00 days 2.00 days Expected availability float Annual interest rate 6.00%