A company is considering a lockbox system. Its bank has come up with the following...
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Finance
A company is considering a lockbox system. Its bank has come up with the following information on the proposed lockbox system. Reduction in mailing time = 2.0 day Reduction in clearing time = 1.0 day Reduction in firms processing time = 0.5 day Daily interest rate on Treasury bill = 0.01% Average number of daily payments to lockboxes = 150 Average size of payment = $3,000 Assuming that the annual fee of the lockbox system is $18,000 and the cost of processing is $0.25 per check, should the company use the lockbox system?
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