What is the daily interest savings of the system

Reference no: EM13261016

Sherman's Sherbet currently takes about 10 days to collect and deposit checks from customers. A lock-box system could reduce this time to 6 days. Collections average $35,000 daily. The interest rate is .02% per day.

a. By how much will the lock-box system reduce float?

b. What is the daily interest savings of the system?

Reference no: EM13261016

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