Float. General Products writes checks that average $20,000 daily. These checks take an average of 6 days

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Float. General Products writes checks that average $20,000 daily. These checks take an average of 6 days to clear. It receives payments that average $22,000 daily. It takes 3 days before these checks are available to the firm.

a. Calculate payment float, availability float, and net float.

b. What would be General Products’s annual savings if it could reduce availability float to 2 days? The interest rate is 6 percent per year. What would be the present value of these savings?

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