Questions:

Requirement 1: Samantha Charleston identified relevant costs but didn't complete the analysis.
Complete the analysis and determine total savings (if any) each year and for the three-year period.
Make sure to use formulas and calculations in the cells to arrive at your answer.
	Process Checks As-Is	Automate Check Processing
Annual Cost (Savings):
Bank Charges of Processing Recurring Payments
Bank Charges of Processing other Electronic Payments
Savings in Salary Reductions
Savings in PC, IT support, other costs
Savings in postage costs
Annual Costs over Three Year Period:
Severance Payments for Staff Reduction
Total Savings over Three Year Period
Requirement 2: Determine two qualitative (nonfinancial) costs relating to the automation of the
electronic payments decision.
Requirement 3: Would you automate the check processing? Why or why not?

Quantitative Costs: Decrease in use of paper ohecks from 2006-2009 Savings from use of electronic payments - Low end Savings from use of electronic payments high end 5% 20% 90% Bank charges for electronic payments 0.125 per electronic payment Time to process paper check Time to process electronic payment Time savings on recurring payments 2 minutes 1.5 minutes 80% annually Table 3: Budgeted Costs Accounts Payable Salaries 470,000 Benefits load 117,500 Rent and related 64,000 16,750 12,000 11,500 270,000 Supplies PCs IT Support Postage Travel and Entertainment 11,500 8,000 981,250 Corporate expenses Total Table 4: Summary of Checks Processed per Month Checks Recurring Percentage of total checks 8,000 monthly 16% 17,000 monthly Business ParnterslEmployees Potential Electronic Payr Percentage of total oheoks 34% All other checks 25,000 Percentage of total checks 50% Estimate of processing of current payments electronically Reduction in processing time from electronic payments Potential time savings from setting up recurring payments 50% 25% 80% Labor Savings from Processing Payments: Current Employees processing payments Checks processed by employees 10 600,000 annually Calculated current costs related to time to process payme $ 1.02 per check Percentage of checks estimated to be processed electror 50% Percentage of Staff Reductions of Accountss Payable 15% 1,775.00 per employee Savings in PC, IT support, other oosts Reduction in postage costs by moving to electronic paym 50% direct proportion to reduction of checks 15% of maximum Acoounts Payable coverage Percentage of Severance from Accounts Payable Quantitative Costs: Decrease in use of paper ohecks from 2006-2009 Savings from use of electronic payments - Low end Savings from use of electronic payments high end 5% 20% 90% Bank charges for electronic payments 0.125 per electronic payment Time to process paper check Time to process electronic payment Time savings on recurring payments 2 minutes 1.5 minutes 80% annually Table 3: Budgeted Costs Accounts Payable Salaries 470,000 Benefits load 117,500 Rent and related 64,000 16,750 12,000 11,500 270,000 Supplies PCs IT Support Postage Travel and Entertainment 11,500 8,000 981,250 Corporate expenses Total Table 4: Summary of Checks Processed per Month Checks Recurring Percentage of total checks 8,000 monthly 16% 17,000 monthly Business ParnterslEmployees Potential Electronic Payr Percentage of total oheoks 34% All other checks 25,000 Percentage of total checks 50% Estimate of processing of current payments electronically Reduction in processing time from electronic payments Potential time savings from setting up recurring payments 50% 25% 80% Labor Savings from Processing Payments: Current Employees processing payments Checks processed by employees 10 600,000 annually Calculated current costs related to time to process payme $ 1.02 per check Percentage of checks estimated to be processed electror 50% Percentage of Staff Reductions of Accountss Payable 15% 1,775.00 per employee Savings in PC, IT support, other oosts Reduction in postage costs by moving to electronic paym 50% direct proportion to reduction of checks 15% of maximum Acoounts Payable coverage Percentage of Severance from Accounts Payable