You Are Considering Implementing a Lockbox System for Your fiRm

question 165

Multiple Choice

You are considering implementing a lockbox system for your firm. The system is expected to reduce the collection time by 2 days. On an average day, your firm receives 1,650 checks with an average
Value of $910 each. The daily interest rate on Treasury bills is .02 percent. The bank charge per
Check would be $.35. What is the net present value of this lockbox arrangement?

• A) $115,500
• B) $212,750
• C) $300,300
• D) $525,525
• E) $600,600

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Definitions:

Email Communication

The exchange of information or messages between individuals or groups through electronic mail.

70-20-10 Model

A model for learning and development proposes that people gain 70% of their knowledge through experiences related to their work, 20% through interactions with others, and 10% from structured educational activities.

Formal Training

Structured educational or training programs designed to develop skills and knowledge in a specific field or profession.

Formal Learning

Structured educational experiences, typically occurring in institutional settings like schools or training centers, that lead to certification or degrees.