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SNK, Inc. is considering evaluating its collection and deposit proce- dures. SNK typically has sales of $5 million per day. SNKs opportu- nity cost of
SNK, Inc. is considering evaluating its collection and deposit proce- dures. SNK typically has sales of $5 million per day. SNKs opportu- nity cost of investing in cash is 10%. If SNK can reduce the time it takes to clear its payments from customers from 7 to 6 days, what is the benet to SNK? How much should SNK be willing to pay in annual fees to accomplish this oat reduction?
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