Check my workCheck My Work button is now enabled Item 3 Time Remaining 1 hour 47 minutes 11 seconds 01 47 11 Bird's Eye Treehouses, Inc , a Kentucky company, has determined that a majority of its customers are located in the Pennsylvania area It therefore is considering using a lockbox system offered by a bank located in Pittsburgh The bank has estimated that use of the system will reduce collection time by 1 5 days Assume 365 days a year Average number of payments per day 880 Average value of payment $ 830 Variable lockbox fee (per transaction) $ 10 Annual interest rate on money market securities 3 2 a What is the NPV of the new lockbox system (Do not round intermediate calculations and round your answer to 2 decimal places, e g , 32 16 ) b Suppose in addition to the variable charge that there is an annual fixed charge of $3,000 to be paid at the end of each year What is the NPV now (A negative answer should be indicated by a minus sign Do not round intermediate calculations and round your answer to 2 decimal places, e g , 32 16 )

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Check my workCheck My Work button is now enabled Item 3 Time Remaining 1 hour 47 minutes 11 seconds 01:47:11 Bird's Eye Treehouses, Inc., a

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Bird's Eye Treehouses, Inc., a Kentucky company, has determined that a majority of its customers are located in the Pennsylvania area. It therefore is considering using a lockbox system offered by a bank located in Pittsburgh. The bank has estimated that use of the system will reduce collection time by 1.5 days. Assume 365 days a year.


Average number of payments per day		880
Average value of payment	$	830
Variable lockbox fee (per transaction)	$	.10
Annual interest rate on money market securities		3.2	%


a.	What is the NPV of the new lockbox system? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
b.	Suppose in addition to the variable charge that there is an annual fixed charge of $3,000 to be paid at the end of each year. What is the NPV now? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)