Question
Your firm has an average receipt size of $170. A bank has approached you concerning a lockbox service that will decrease your total collection time
| Your firm has an average receipt size of $170. A bank has approached you concerning a lockbox service that will decrease your total collection time by one day. You typically receive 5,500 checks per day. The daily interest rate is 0.017 percent. The bank charges a lockbox fee of $130 per day. |
| What is the NPV of accepting the lockbox agreement? |
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Financial Statement Analysis & Dividend Investing
Authors: Andrew P.C.
1st Edition
1075873940, 978-1075873942
