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Marta_Voda [28]
3 years ago
14

​(Cash management​) As CFO of Portobello Scuba Diving Inc. you are asked to look into the possibility of adopting a lockbox syst

em to expedite cash receipts from clients.
Portobello receives check remittances totaling ​$28 million in a year.
The firm records and processes 15 000 checks in the same period.
The National Bank of Brazil has informed you that it could provide the service of expediting checks and associated documents through the lockbox system for a unit cost of $ 0.20 per check.
After conducting an​ analysis, you project that the cash freed up by the adoption of the system can be invested in a portfolio of​ near-cash assets that will yield an annual​ before-tax return of 6 percent.
The company usually uses a​ 365-day year in its financial calculations.
a. What reduction in check collection time is necessary for Portobello to be neither better nor worse off for having adopted the lockbox​ system?
b. How would your solution to part ​(a​) be affected if Portobello could invest the​ freed-up balances at an expected annual return of only 3 ​percent?
c. What is the logical explanation for the differences in your answers to part ​(a​) and part ​(b​)?
Business
1 answer:
zheka24 [161]3 years ago
8 0

Answer:

Check the answers below

Explanation:

  • The per instrument cost of the bank is $0.25. Assuming uniform cheque value, the 24 million remittances across 10000 cheque will mean per cheque value of 2400. If this amount can be invested at 8% p.a., then daily investment income will be approx = 2400 * 8% /365 = $ 0.526

  • Now for the company to jus about cover the cost of the cheque processing, the time should reduce by (assuming fractional time in days is possible) 0.25/0.526 = 0.48 days

  • Now if the interest that can be earned reduces to 4%, the average daily interest will also reduce to $0.263. At this level, the time required to cover the cost should reduce by 0.95 days

The difference is simply because the opportunity cost in terms of alternate usage of funds has decreased for the company.

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Wen, a consumer researcher, is conducting a research on the buying behavior of the hispanics. as part of her study, she calculates a consumer's buying power by relating it to the consumer's income. the consumer attributes that wen employs in her research can best be described <u>demographics.</u>

4 0
3 years ago
what a successful entrepreneur's profile is and to determine whether your personal characteristics fit that profile. I
ANTONII [103]

Answer:

Explanation:

A successful entrepreneur’s profile is characterized of the following:  

1) Self-control: this is the belief that you can do a certain job better than others in the most accountable and responsible manner.

2) Self-confidence: it refers to the never-ending spirit of urgency to develop ideas

3) Realism: it refers to the acceptance of the things as they occur and dealing with them cautiously.  

4) Conceptual capability: it refers to an entrepreneur’s ability to recognize relationships swiftly even in the midst of difficult situations.  

5) Comprehensive awareness: it refers to the ability to understand complicated situations through planning, strategic decision making, and pursuing multiple business ideas concurrently.  

7 0
3 years ago
What would bill fall under, he applied and acquired for a new credit card and uses it regularly?
lidiya [134]

If  he applied and acquired for a new credit card and uses it regularly he will fall under: Voluntary.

<h3>What is credit card?</h3>

Credit card can be defined as the card that enables the card holder to carryout transactions such as purchases online in which the holder is expected to payback the amount used for the purchases.

If a obtain a new credit card which he use often or frequently, bill will tend to fall under voluntary because he voluntary applied for the credit card without being comply to do so.

Therefore bill will fall under voluntary.

Learn more about credit card here:brainly.com/question/8432538

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4 0
2 years ago
The Cash account in the ledger of Clear Windows shows a balance of $12,596 at September 30. The bank statement, however, shows a
Norma-Jean [14]

Answer:

1. $3,067

2. B) $129,127.

Explanation:

a. The computation of amount deposit in transit is shown below:

The amount of deposit in Transit =  Balance as per Cash Book as on 30th Sept - Cheque outstanding realized - Bank charges -  Balance as per Bank Book

= $12,596 + $6740 - $16 - $16,253

= $3,067

Deposit in Transit inflates the general ledger initially till it is credited in the bank book.

b. The computation of balance should Cardinal's Cash account show

Cash Account should show a balance =  Bank Statement Balance as on May 31 - Outstanding Cheque on May 31

= $180,974 - $51,847

= $129,127  

As we can see that the cash account balance is less because there is an outstanding

5 0
4 years ago
Item 1 Manufacturing overhead was estimated to be $629,300 for the year along with 20,300 direct labor hours. Actual manufacturi
Neporo4naja [7]

Answer:

$31 per hour

Explanation:

The predetermined overhead rate is computed as

= Estimated manufacturing overhead / Estimated direct labor hours

Given that

Estimate manufacturing overhead = $629,300

Estimated direct labor hour = 20,300

Therefore,

Predetermined overhead rate

= $629,300 / 20,300

= $31 per hour

5 0
3 years ago
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