Every day, Consolidated Blancmange writes checks worth $100,000. These checks take an average of five days to
Question:
Every day, Consolidated Blancmange writes checks worth $100,000. These checks take an average of five days to clear. The company also receives payments of $150,000 every day. These take three days to clear.
a. Calculate payment float, availability float, and net float.
b. What would be the company’s annual savings if it could reduce availability float to one day? The interest rate is 6 percent a year. What would be the present value of these savings?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
a Payment float 5 100000 500000 Availability float 3 150000 450000 Net float 500000 4500...View the full answer
Answered By
Fahmin Arakkal
Tutoring and Contributing expert question and answers to teachers and students.
Primarily oversees the Heat and Mass Transfer contents presented on websites and blogs.
Responsible for Creating, Editing, Updating all contents related Chemical Engineering in
latex language
8+ Reviews
22+ Question Solved
Related Book For 
Principles of Corporate Finance
ISBN: 978-0072869460
7th edition
Authors: Richard A. Brealey, Stewart C. Myers
Question Posted:
