Aditya Birla Retail Limited, an Indian retail company, is considering a lockbox system that can shorten its
Question:
Aditya Birla Retail Limited, an Indian retail company, is considering a lockbox system that can shorten its accounts receivable collection by 1 day.
Credit sales are INR 550,000,000 per year, billed on a continuous basis. The firm has other equally risky investments that earn a return of 14%. The cost of the lockbox system is INR 90,000 per year.
a. What amount of cash will be made available for other uses under the lockbox system?
b. What net benefit (cost) will the firm realize if it adopts the system? Should the company adopt it?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 100% (1 review)
To determine the cash made available for other uses under the lockbox system and the net benefit or cost of adopting the system we need to calculate t...View the full answer
Answered By
Ashington Waweru
I am a lecturer, research writer and also a qualified financial analyst and accountant. I am qualified and articulate in many disciplines including English, Accounting, Finance, Quantitative spreadsheet analysis, Economics, and Statistics. I am an expert with sixteen years of experience in online industry-related work. I have a master's in business administration and a bachelor’s degree in education, accounting, and economics options.
I am a writer and proofreading expert with sixteen years of experience in online writing, proofreading, and text editing. I have vast knowledge and experience in writing techniques and styles such as APA, ASA, MLA, Chicago, Turabian, IEEE, and many others.
I am also an online blogger and research writer with sixteen years of writing and proofreading articles and reports. I have written many scripts and articles for blogs, and I also specialize in search engine
I have sixteen years of experience in Excel data entry, Excel data analysis, R-studio quantitative analysis, SPSS quantitative analysis, research writing, and proofreading articles and reports. I will deliver the highest quality online and offline Excel, R, SPSS, and other spreadsheet solutions within your operational deadlines. I have also compiled many original Excel quantitative and text spreadsheets which solve client’s problems in my research writing career.
I have extensive enterprise resource planning accounting, financial modeling, financial reporting, and company analysis: customer relationship management, enterprise resource planning, financial accounting projects, and corporate finance.
I am articulate in psychology, engineering, nursing, counseling, project management, accounting, finance, quantitative spreadsheet analysis, statistical and economic analysis, among many other industry fields and academic disciplines. I work to solve problems and provide accurate and credible solutions and research reports in all industries in the global economy.
I have taught and conducted masters and Ph.D. thesis research for specialists in Quantitative finance, Financial Accounting, Actuarial science, Macroeconomics, Microeconomics, Risk Management, Managerial Economics, Engineering Economics, Financial economics, Taxation and many other disciplines including water engineering, psychology, e-commerce, mechanical engineering, leadership and many others.
I have developed many courses on online websites like Teachable and Thinkific. I also developed an accounting reporting automation software project for Utafiti sacco located at ILRI Uthiru Kenya when I was working there in year 2001.
I am a mature, self-motivated worker who delivers high-quality, on-time reports which solve client’s problems accurately.
I have written many academic and professional industry research papers and tutored many clients from college to university undergraduate, master's and Ph.D. students, and corporate professionals. I anticipate your hiring me.
I know I will deliver the highest quality work you will find anywhere to award me your project work. Please note that I am looking for a long-term work relationship with you. I look forward to you delivering the best service to you.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Principles Of Managerial Finance Brief
ISBN: 9781292267142
8th Global Edition
Authors: Chad J. Zutter, Scott B. Smart
Question Posted:
Students also viewed these Business questions
-
Eagle Industries feels that a lockbox system can shorten its accounts receivable collection period by 3 days. Credit sales are $3,240,000 per year, billed on a continuous basis. The firm has other...
-
Qtime Products believes that use of a lockbox system can shorten its accounts receivable collection period by four days. The firms annual sales, all on credit, are $65 million, billed on a continuous...
-
Allstar Inc. is considering a lockbox system that would reduce its float by three days. An expected 500 collections per day will be made to the lockbox with an average payment size of $1,000. The...
-
Read the case study given below and answer the following questions Assignment: Ethics in Firefighting Firefighter ordered suspended without pay after trying to rescue an elderly woman from a fire By...
-
1. Explain how to find the stable matrix of an absorbing stochastic matrix? 2. What is the fundamental matrix of an absorbing stochastic matrix, and how is it used?
-
Consider two stars that have the spectra shown in Figure 3.7. Based just on the information provided in this plot, what are the colors and radiating temperatures of the stars? Figure 3.7 power...
-
A model for a hemodialyser with simulation of the patient-artificial-kidney system: a case-study problem. A useful case study is the paper by Ramachandran and Mashelkar (1980), where a mesoscopic...
-
The 7FA gas turbine manufactured by General Electric is reported to have an efficiency of 35.9 percent in the simple-cycle mode and to produce 159 MW of net power. The pressure ratio is 14.7 and the...
-
Image transcription text Question WHP8-Q1. The system in figure is composed of: m1,Ic . a disc of radius r = 0.5 m, mass m1 = 0.5 kg and moment of inertia Ic = 62.5 g.ma, with respect to its centre...
-
Alumina Ltd. is considering establishing a zero-balance account. The company currently maintains an average of A$1,380,000 in its disbursement account. As compensation to the bank of maintaining the...
-
Uneblej.com is an online retail company, which operates in Albania. It has daily cash receipts of L150,000. Its CFO is analyzing the time it takes for the collection of the customers payment to clear...
-
Explain the importance of environmental groups and corporations working together.
-
During extension, why do we sometimes get joints (and veins) and other times shear fractures and faults?
-
In countries in which there is nonprice rationing for care, waiting time costs may be substantial. How could you measure the economic costs of the waiting time?
-
It is important to compare items under the rubric of all else equal. What crucial factors must be adjusted when comparing health expenditures across countries?
-
Is fault sealing good or bad in terms of petroleum exploration and production?
-
How could a single-insurer health insurance system provide additional cost savings over a multiple-insurer system like that in the United States? Price 100 90 85 80 70 60 55 50 40 30 20 10 0 Quantity...
-
Refer to PE 410. 1. Make the adjusting entry necessary on the companys books on December 31 with respect to this insurance policy 2. Compute the ending balance in the prepaid insurance account....
-
Smiths Family Fashions implemented a balanced scorecard performance measurement system several years ago. Smiths is a locally owned clothing retailer with fashions for men, women, teens, and...
-
Lang Enterprises is interested in measuring its overall cost of capital. Current investigation has gathered the following data. The firm is in the 40% tax bracket. Debt. The firm can raise an...
-
Cartwell Products has compiled the data shown in the following table for the current costs of its three basic sources of capitallong-term debt, preferred stock, and common stock equityfor various...
-
Grainger Corp., a supplier of fitness equipment, is trying to decide whether to undertake any or all of the proposed projects in its investment opportunities schedule (IOS). The firms cost-of-capital...
-
Explain the principles underlying cladistics and how they contribute to the construction of phylogenetic trees in modern taxonomy .
-
3. Provide examples of how the current and future banking regulations will impact the industry both positively and negatively.
-
How can people improve their finances and be financial literate? Elaborate briefly
Study smarter with the SolutionInn App