How Much Time Must Be Saved to Justify a Lock-Box

question 112

Multiple Choice

How much time must be saved to justify a lock-box system that processes 350 cheques per day at an average amount of $400 per cheque if the system will cost $20,000 annually and interest rates average 8 percent?

• A)0.56 days
• B)1.79 days
• C)2.14 days
• D)7.00 days break-even point for system = $20,000/.08 = $250,000
• Thus, the system must reduce collection float by $250,000.
• 300 cheques x $400 per cheque x days saved = $250,000

---

Definitions:

Biological Component

The aspects of an individual's characteristics determined by genetic inheritance from their biological parents.

DSM

The Diagnostic and Statistical Manual of Mental Disorders, a comprehensive classification system for mental health diagnoses developed by the American Psychiatric Association.

Psychologists

Professionals specializing in the study and practice of psychology, focusing on understanding, explaining, and predicting behavior, emotions, and mental processes.

Tourette's

A neurological disorder characterized by involuntary tics and vocalizations.