Flashbinder Guitars, Inc is negotiating with the bank for a lockbox system that is expected to
reduce check collection time by 4 days.
Flashbinder Guitars' average check size is $1,200 and any
funds freed up by the new system will be invested in a money-market account that is currently
paying 2.5% annually. What is the most Flashbinder Guitars should be willing to pay the bank for
the lockbox service, assuming the bank charges a per-check processing fee?
A) 32.877 cents B) 20.500 cents C) 29.767 cents D) 30.726 cents
A
Business
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