NPV and Collection time your firm has an average receipt size of $95. A ban has approached
Question:
NPV and Collection time your firm has an average receipt size of $95. A ban has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 9,400 checks per day. The daily interest rate is .016 percent. If the bank charges a fee of $190 per day, should the lockbox project be accepted? What would the net annual savings be if the service were adopted?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 77% (9 reviews)
The average daily collections are the number of checks received times the average value of a check s...View the full answer
Answered By
Milan Mondal
I am milan mondal have done my Msc in physics (special astrophysics and relativity) from the University of burdwan and Bed in physical science from the same University.
From 2018 I am working as pgt physics teacher in kendriya vidyalaya no2 kharagpur ,west bengal. And also I am doing advanced physics expert in chegg.com .also I teach Bsc physics .
I love to teach physics and acience.
If you give me a chance I will give my best to you.
5.00+
4+ Reviews
10+ Question Solved
Related Book For
Fundamentals of Corporate Finance
ISBN: 978-0077861629
8th Edition
Authors: Stephen A. Ross, Randolph W. Westerfield, Bradford D.Jordan
Question Posted:
Students also viewed these Corporate Finance questions
-
Your firm has an average receipt size of $127. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 4,950 checks per...
-
Your firm has an average receipt size of $125. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 6,400 checks per...
-
Your firm has an average receipt size of $117. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 6,500 checks per...
-
Fill in each blank so that the resulting statement is true. I find (f g)(x) by replacing each occurrence of x in the equation for_______ with________ .
-
NASA operates a 2.2-second drop tower at the Glenn Research Center in Cleveland, Ohio. At this facility, experimental packages are dropped from the top of the tower, on the 8th floor of the building....
-
By referring to the periodic table (Figure 2.15 or inside front cover), identify the group and period to which each of the following elements belongs. Then decide whether the element is a metal,...
-
You have two cylindrical solenoids, one inside the other, with the two cylinders concentric. The outer solenoid has length \(\ell_{\text {ourer }}=400 \mathrm{~mm}\), radius \(R_{\text {outer }}=50...
-
Howard Harrison, a longtime customer of Western Bank, operates a small department store, Harrisons Store. Because his store has few experienced employees, Harrison frequently travels throughout the...
-
The hybrid state of the Xe and shape of the XeF4 molecule are: 1. (a) sp and tetrahedral 2. (c) sp d and square planar (b) spd and tetrahedral (d) sp d and see saw Which of the following relation is...
-
Aritzia Inc.s financial statements have been reproduced in Appendix A at the back of the textbook. Instructions a. Many companies use a calendar year for their financial statements. What does Aritzia...
-
Float and Weighted Average Delay your neighbor goes to the post office once a month and picks up two checks, one for $13,000 and one for $4,000. The larger check takes four days to clear after it is...
-
Using weighted average Delay a mail-order firm processes 4,500 checks per month. Of these, 60 percent are for $50 and 40 percent are for $70. The $50 checks are delayed two days on average; the $70...
-
Calculate the higher and lower heating values of a coal from Illinois which has an ultimate analysis (by mass) as 67.40 percent C, 5.31 percent H2, 15.11 percent O2, 1.44 percent N2, 2.36 percent S,...
-
Margoles Publishing recently completed its IPO. The stock was offered at a price of $16 per share. On the first day of trading, the stock closed at $22 per share. What was the initial return on...
-
Suppose the risk-free interest rate is 5.7% APR with monthly compounding. If a $2.8 million MRI machine can be leased for five years for $48,000 per month, what residual value must the lessor recover...
-
Baruk Industries has no cash and a debt obligation of $31 million that is now due. The market value of Baruks assets is $77 million, and the firm has no other liabilities. Assume perfect capital...
-
Suppose the tax rate on interest income is 40%, and the average tax rate on capital gains and dividend income is 15%. How high must the marginal corporate tax rate be to offer a tax advantage?
-
Markum Enterprises is considering permanently adding $127 million of debt to its capital structure. Markums corporate tax rate is 40%. a. Absent personal taxes, what is the value of the interest tax...
-
If structured analysis and design is applied as the front end for OOAD, which of the following documents can be used to derive objects and classes? (a) CFD and CSPEC (b) ER Diagram (c) DFD (d) All of...
-
In July 2013, cnet.com listed the battery life (in hours) and luminous intensity (i. e., screen brightness, in cd/m2) for a sample of tablet computers. We want to know if screen brightness is...
-
While taking a bath, a person touches the metal case of a radio. The path through the person to the drainpipe and ground has a resistance of 4000 . What is the smallest voltage on the case of the...
-
If Newell Corp. has a ROE of 13.7 percent and a dividend payout ratio of 32 percent, what is its sustainable growth rate?
-
Refer to Exhibits 19.10 and 19.11 in the text. The EFNs for several growth rates for Empire Enterprises are as follows: Growth Rate (%) EFN ($ millions) 0% ........... -$4.8 5 ............ -2.3 9.6...
-
Refer to Problem 19.7. Northwood expects to increase its sales by 15 percent next year. All costs vary directly with sales. If Northwood wants to retain $65,000 of earnings next year, will it have to...
-
S&J Catering is a small catering business operating in Western Sydney. Business partners, Jack and Simon, established the business a year ago. To start up the business, the partners contributed...
-
In 20X1, Lee was hurt in the course of his employment with Foster Farms. In 20X1, Lee was paid the following amounts from Foster Farms' worker's compensation insurance company: $30,000 for a physical...
-
Briefly describe tax administrative matters including: Tax collection and withholding mechanisms (PAYG withholding, PAYG instalments).
Study smarter with the SolutionInn App