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Lloyds Bank has offered you a cash management system which will reduce the collection time for your company's daily receipts by 2 days. This service
Lloyds Bank has offered you a cash management system which will reduce the collection time for your company's daily receipts by 2 days. This service will cost you $ 15000 per year. Currently short term money market rate is 5%. You are forecasting annual credit sales of $46355000 million. a. Calculate daily sales value. b. Calculate the amount of freed up cash. c. Calculate the annual benefit from the freed up cash before the bank's fee. d. Calculate the net benefit of the proposal. e. Would you take the deal or no?
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