Your firm sells to retail customers nationwide. Your bank has just completed a lockbox study of your cash collection system. After a through study of your remittance information, they categorized your customers into 3 groups as shown below. Notice that the consultants expressed remittance data on an average daily basis assuming 30 days in a month. Your opportunity cost of funds is 8%.

Using the complete enumeration model to determine the optimal number of lockbox sites and the customer allocation amount the chosen sites.

Avrage Monthly Remittances Number Days of Float Bank BBank C Customer Group Face Value BankA 3000 $ 9000 $ 5000 $ 1,250.00 750.00 1,000.00 4 4 2 2 2 Variable Processing Costs Fixed Costs 4 $0.45$0.30$ 0.50 $750.00 $1,000.00 $500.00