23. Assume that each day a company writes and receives checks totaling P 10,000. If it takes 5 days for the checks to clear

and be deducted from the company's account, and only 4 days for the deposits to clear, what is the float?

24. Arctic is a retail mail order firm that currently uses a central collection system. An average of 6 days is required for mailed

checks to be received, 3 days for Arctic to process them, and 2 days for the checks to clear through its bank. A proposed

lockbox system would reduce the mailing and processing time to 2 days and the check-clearing time to 1 day. Arctic has

an average daily collection of P 150,000. If Arctic adopts the lockbox system, its average cash balance will increase by

27. A firm has daily cash receipts of P 100,000 and collection time of 2 days. A bank has offered to reduce the collection

time on the firm's deposit by 2 days for a monthly fee of P 500. If money market rates are expected to average 6%

during the year, the net annual benefit (loss) from having this service is

31. China Inc. has a majority of its customers located in Metro Manila. Tibetan, a major retail bank, has agreed to provide a

lockbox system to China at a fixed fee of P 50,000 per year and a variable fee of P0.50 for each payment processed by

the bank. On average, China receives 50 payments per day, each averaging P 20,000. With the lockbox system, the

company's collection float will decrease by 2 days. The annual interest rate on money market securities is 6%. If China

makes use of the lockbox system, what would be the net benefit to the company? (Use 365 days per year)

34. Russia, Inc. sells with terms 3/10, net 30 days. Gross sales for the year are P 2,400,000 and the collections department

estimates that 30% of the customers pay on the tenth day and take discounts; 40% pay on the thirtieth day; and the

remaining 30% pay, on the average, 40 days after the purchase. Assuming 360 days per year, what is the average

collection period?

35. England Company has an inventory conversion period of 60 days, a receivable conversion period of 35 days, and a

permanent cycle of 26 days. If its sales for the period just ended amounted to P 972,000, what is investment in accounts

receivable? (Assume 360 days in a year)

36. Italy sells to retail stores on credit terms of 2/10, n/30. Daily sales average 150 units at a price of P 300 each. Assuming

that all sales are on credit and 60% of its customers take the discount and pay on day 10 while the rest of the customers

pay on day 30, what is the amount of Italy's accounts receivable?