Cash Management
Norma’s Cat Food of Shell Knob ships cat food throughout the country. Norma has determined that through the establishment of local collection centers around the country, she can speed up the collection of payments by two and one-half days. Furthermore, the cash management department of her bank has indicated to her that she can defer her payments on her accounts by one-half day without affecting suppliers. The bank has a remote disbursement center in Iowa.
- If the company has $5 million per day in collections and $3 million per day in disbursements, how many dollars will the cash management system free up? Justify your answers.
- If the company can earn 8 percent per annum on freed-up funds, how much will the income be? Justify your answers.
- If the annual cost of the new system is $800,000, should it be implemented? Explain why or why not.
Looking for a similar assignment? Our writers will offer you original work free from plagiarism. We follow the assignment instructions to the letter and always deliver on time. Be assured of a quality paper that will raise your grade. Order now and Get a 15% Discount! Use Coupon Code "Newclient"
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines
Order Paper Now