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A mail - order firm processes 5 , 8 0 0 checks per month. Of these, 6 0 percent are for $ 4 9 and
A mailorder firm processes checks per month. Of these, percent are for $ and percent are for $ The $ checks are delayed two days on average; the $ checks are delayed three days on average. Assume days in a month.
a What is the average daily collection float? Do not round intermediate calculations.
a How do you interpret your answer? Do not round intermediate calculations.
b
What is the weighted average delay? Do not round intermediate calculations and round your answer to decimal places, eg
b Calculate the average daily float. Do not round intermediate calculations.
c How much should the firm be willing to pay to eliminate the float? Do not round intermediate calculations.
d
If the interest rate is percent per year, calculate the daily cost of the float. Use days a year. Do not round intermediate calculations and round your answer to decimal places, eg
e How much should the firm be willing to pay to reduce the weighted average float to days? Do not round intermediate calculations.
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