Shasroy Company's sales collection has been concentrated in Dhaka since its inception However, its business operations have expanded widely from Teknaaf to Tetulia over the last few years. As a result, it has been taking a long time to collect payments from many far-flung places of the country. Shasroy's Finance manager estimates that it currently takes an average of 5 days from the day customers mail cheques until they are received, processed and deposited.

Shasroy has recently received an offer from Chameli Bank to establish a lockbox system consisting of 30 lockboxes for Shasroy in order to expedite its cheque collection process. Chameli proposes that by installing a countrywide lockbox system it can collect cheques in the local lockboxes in one day and will take another 1 day to send the cheques to Shasroy's concentration bank in Dhaka through electronic DTC. Shasroy's Financial manager estimates that daily collection per lockbox will amount to Tk.40,000.

Chameli's monthly fixed charges for lockbox maintenance will be Tk. 30,000 per month Chameli will transfer cheques 5 days a week throughout the year. It will charge Tk.5.00 per transfer from lockboxes to concentration bank. Shasroy's opportunity cost is 12 per cent per year.

Do the necessary calculations and decide whether Shasroy should accept Chameli's offer for lockbox installation. (Assume 52 weeks a year)