What is the reduction in outstanding cash balances

Assignment Help Finance Basics
Reference no: EM13266016

It takes Cookie Cutter Modular Homes, Inc., about six days to receive and deposit checks from customers. Cookie Cutter's management is considering a lockbox system to reduce the firm's collection times. It is expected that the lockbox system will reduce receipt and deposit times to three days total. Average daily collections are $127,000, and the required rate of return is 6 percent per year. Assume 365 days per year.

What is the reduction in outstanding cash balances as a result of implementing the lockbox system?

Reference no: EM13266016

Questions Cloud

What is the absolute pressure at the bottom of the container : A container is filled to a depth of 25.0 cm with water. What is the absolute pressure at the bottom of the container
What estimate can he make of the real rate of return : On the basis of the information that Carl has collected, what estimate can he make of the real rate of return?
What is the final temperature of the rock-water system : A 211kg rock sits in full sunlight on the edge of a cliff 4.90m high. The temperature of the rock is 30.2?C. what is the final temperature of the rock-water system
What level of priority did political news receive : What was the lead story? What level of priority did political news receive and what were the similarities in the general nature of the stories which received coverage? What were the major differences?
What is the reduction in outstanding cash balances : What is the reduction in outstanding cash balances as a result of implementing the lockbox system?
What is the speed of the wave along the violin string : suppose the memebers of an orchestra are tuning up their instruments, whats's the speed of the wave along the violin string
What is the open market operation : The federal reserve monetary controll the open market. what is the open market operation? What is its goals?
Which type of chemical bond would result from this process : If the asteroid fragment contains carbon, it may burn when entering Earth's atmosphere. Which type of chemical bond would result from this process
describe a bearish pattern with the two MA lines : Assuming a stock price and volume chart that also contains a 50-day and a 200-day MA line, describe a bearish pattern with the two MA lines and discuss why it is bearish.

Reviews

Write a Review

Finance Basics Questions & Answers

  Calculation of return on investment and residual income

Calculation of return on investment and residual income and Calculate the missing amounts for each division

  Instant electronic checks

Collegiate Tuxedo rents apparel throughout the year. They have experienced non-payment by about 15 percent of their customers with an average loss of $200.

  Residual dividend policy and maximum investment funds

Sheffield, Inc. predicts that earnings in coming year will be $20 million. There are eight million shares, and Sheffield maintains the debt-equity ration of 1.4. Compute the maximum investment funds available without issuing new equity and the inc..

  What is the constatnt rate the stock is expected

Stock price is $40 and it recently paid $1.20 dividend. This dividend is expected to grow by 15% for the next 3 years, and then grow forever at a constat rate, g. If the required rate of return is %12, what is the constatnt rate the stock is expec..

  What is the net cost of the spectrometer

The spectrometer would have no effect on revenues, but it is expected to save the firm $25,000 per year in before-tax operating costs, mainly labor. The firm's marginal federal-plus-state tax rate is 40%.

  Impact of rupiah depreciation on bakrie

Assess the likely impact of the rupiah's depreciation on Bakrie's three different businesses. Which of Bakrie's businesses will be most hurt by the rupiah's fall? Will any of these businesses actually benefit from rupiah depreciation?

  Goal is to generate a portfolio with the expected return

If your goal is to generate a portfolio with the expected return of 14.25%, how much money will you invest in stock A. In Stock B.

  How much will your collection be worth

Your coin collection contains 45 1952 silver dollars. If your grandparents purchased them for their face value when they were new, how much will your collection be worth when you retire in 2055, assuming they appreciate at a 5.6 percent annual rat..

  Computation of required return of a portfolio

Computation of required return of a portfolio and risk factor analysis and Calculate the required return of a portfolio that has $7500 invested in Stock X and $2500 invested in Stock Y

  What annual rate of return did the firm earn on this project

Cast Out Co. invested $16,200 in a project. At the end of two years, the company sold the project for $23,800. What annual rate of return did the firm earn on this project?

  Prepare the stockholders equity section

The following transactions occurred at Horton corporation., during its 1st year of operation: Issued 100,000 shares of common stock at $5 each; 1,000,000, shares are authorized at $1 par value.

  Compute the sales tax

Suppose you are shopping for office supplies and furnishings for your corporation, Financial Outsourcing, Corporation Use the comparative shopping web search engines in the Library to conduct the following research.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd