Tocor Is Considering the Implementation of a Lockbox Collection System

question 33

Multiple Choice

Tocor is considering the implementation of a lockbox collection system for its mid-western and western sales regions.Sales in those two regions are 30 percent of Tocor's annual sales of $560 million.The lockbox system will cost $187,000 a year and reduce collection time by 3 days.If Tocor could invest any released funds at 10.85 percent, should it use the lockbox system? Assume 365 days per year.

• A)Yes, savings of $149,819
• B)Yes, savings of $312,397
• C)No, loss of $37,181
• D)No, loss of $35,100

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Definitions:

Methodology

The system of methods and principles used in a particular discipline or field of study to gather and analyze data.

Evolutionary Psychology

A branch of psychology that studies how evolutionary principles help explain the structure and function of the human mind.

Cerebral Cortex

The outer layer of the brain that is responsible for complex cognitive processes, including thought, memory, awareness, and consciousness.

Biological Evolution

The process by which different kinds of living organisms are thought to have developed and diversified from earlier forms during the history of the earth.