Allstar Inc. is considering a lockbox system that would reduce its float by three days. An expected 500 collections per day will be made to the lockbox with an average payment size of $1,000. The bank's charge for operating the lockboxes is $.30 per cheque. The interest rate is .015 percent per day. How much will Allstar save per day by having the lockbox?

SML Co. has established a lower limit with regard to its cash balance holdings of $10,000. Its daily cash flows have a standard deviation of $5,000. The annual interest rate on marketable securities is 8 percent. The fixed cost per transaction of buying and selling securities is $12. Calculate the target cash balance.

The Trektronics store begins each week with 162 phasers in stock. This stock is depleted each week and reordered. The carrying cost per phaser is $26 per year and the fixed order cost is $50. What is the optimal order quantity?

Zoo Corp. has a chequing account ledger balance of $41,000, and after calling the bank, found that the bank balance was $47,000. A deposit of $5,000 was made this morning and has not yet been credited by the bank. What is the value of the cheques outstanding or payment float?

A firm has a lower limit cash balance of $200 with a standard deviation of $50. The fixed cost per transaction is $8 and the interest rate per period is 0.5%. What is the target cash balance?

A firm has a lower limit cash balance of $200 with a standard deviation of $50. The fixed cost per transaction is $8 and the interest rate per period is 0.5%. What is the average cash balance?

AU Corp. is considering a lockbox system that would reduce its float by two days. Collections average $125,000 per day. The interest rate is 6 percent per year and the bank charges $10 per day for the lockbox system. How much will AU Corp. save per day by having the lockbox?

MJK Co. has established a lower limit with regard to its cash balance holdings of $500. Its daily cash flows have a standard deviation of $200. The annual interest rate on marketable securities is 5 percent. The fixed cost per transaction of buying and selling securities is $10. Calculate the target cash balance.

A firm has a lower limit cash balance of $200 with a standard deviation of $50. The fixed cost per transaction is $8 and the interest rate per period is 0.5%. What is the upper cash limit?

Zoo Corp. uses up cash at a rate of $100,000 per month. The interest rate is 7 percent and each sale of securities costs $30. What is the optimal amount of securities that should be sold each time to minimize the cost of investing cash?