​Whitmer Inc

question 12

Multiple Choice

​Whitmer Inc.sells to customers all over the U.S.,and all receipts come in to its headquarters in New York City.The firm's average accounts receivable balance is $2.5 million,and they are financed by a bank loan at an 11% annual interest rate.The firm is considering setting up a regional lockbox system to speed up collections,and it believes this would reduce receivables by 20%.If the annual cost of the system is $15,000,what pre-tax net annual savings would be realized?

• A)​$29,160
• B)​$32,400
• C)​$36,000
• D)​$40,000
• E)​$44,000

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Definitions:

Psychological Inhibitions

Mental or emotional blocks that prevent an individual from expressing their thoughts, feelings, or desires freely.

Psychoanalytic Therapy

A therapeutic approach developed by Freud that aims to explore the unconscious mind's role in shaping behavior, often through dream interpretation and free association.

Transference

In psychoanalysis, the process by which patients project feelings about important people in their lives onto the therapist.

Unusually Close

Describes a relationship or bond that is more intimate or connected than is common or expected.