5. NPV and Collection Time (LO2] Your firm has an average receipt size of $125. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 5,100 checks per day. The daily interest rate is .016 percent. If the bank charges a fee of $175 per day, should the lockbox project be accepted? What would the net annual savings be if the service were adopted? B D E F G H - J 1 Chapter 19 Question 5 2 3 4 5 Input Area: 6 7 $ 8 9 10 Average receipt Decreased collection time # Checks per day Interest rate Bank fee per day 125 2 5.100 0,016% 175 11 $ 12 13 Output: $ $ 637.500 1.275.000 1.093.750 14 15 16 17 18 19 20 21 22 23 24 25 26 Average daily collections PV Cost NPV Take Lockbox Service? (Y or N) Annual savings Annual cost Annual net savings $ $ 76.670,87 65.771,58 27 28 29