What Are the Expected Annual Savings from a Lock-Box System

question 53

Multiple Choice

What are the expected annual savings from a lock-box system that collects 150 cheques per day averaging $500 each, and reduces mailing and processing times by 2.5 and 1.5 days respectively, if the annual interest rate is 7 percent?

• A)$5,250
• B)$13,125
• C)$21,000
• D)$300,000

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Definitions:

Vernix Caseosa

A waxy or cheese-like white substance found coating the skin of newborn human infants, providing protection.

Amniotic Fluid

The protective liquid contained within the amniotic sac surrounding the fetus during pregnancy, providing cushion and supporting fetal development.

Miliaria

A skin condition often called "heat rash," characterized by small, itchy rashes due to blocked sweat ducts.

Respiratory Breathing

The process of inhaling oxygen and exhaling carbon dioxide through the respiratory system, essential for life and cellular function.