Purple Feet Wine, Inc., receives an average of $14,700 in checks per day. The delay in clearing

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Purple Feet Wine, Inc., receives an average of $14,700 in checks per day. The delay in clearing is typically three days. The current interest rate is .018 percent per day.

a. What is the company’s float?

b. What is the most the company should be willing to pay today to eliminate its float entirely?

c. What is the highest daily fee the company should be willing to pay to eliminate its float entirely?

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Corporate Finance

ISBN: 978-1259918940

12th edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford Jordan

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Question Posted: Dec 13, 2019 07:22 AM

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Purple Feet Wine, Inc., receives an average of $14,700 in checks per day. The delay in clearing

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a The collection float is the average daily checks received times the average number of ...View the full answer

Corporate Finance

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