What will be the annual net savings

Assignment Help Financial Management

Reference no: EM131551543

No More Books Corporation has an agreement with Floyd Bank whereby the bank handles $5.4 million in collections a day and requires a $370,000 compensating balance. No More Books is contemplating canceling the agreement and dividing its eastern region so that two other banks will handle its business. Banks A and B will each handle $2.7 million of collections a day, and each requires a compensating balance of $220,000. No More Books’ financial management expects that collections will be accelerated by one day if the eastern region is divided. What is the NPV of accepting the system? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. ) NPV $ What will be the annual net savings? Assume that the T-bill rate is 2.4 percent annually. (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. ) Annual net savings $

Reference no: EM131551543

Questions Cloud

How did the merchant come out on the bookcase : If the bookcase sold at this price, how did the merchant come out on the bookcase?

What was Frankie initial margin requirement : What was Frankie's initial margin requirement related to this investment in Walsh Industries?

Calculate the stock price based on residual income model : ABC Inc. made $1.00 net income per share last year and paid out $.30 in dividend. Calculate the stock price based on Residual Income Model.

Retirement account arithmetic average return : Based on these returns, what was the retirement account's arithmetic average return over the four year period?

What will be the annual net savings : No More Books’ financial management expects that collections will be accelerated by one day if eastern region is divided. What will be the annual net savings?

Effective or equivalent-annual cost of trade credit : The Thompson Corporation projects an increase in sales from $1.5 million to $2.5 million, What is the effective, or equivalent, annual cost of the trade credit?

Calculate the irr for the project described above : Calculate the IRR for the project described above.

Report the income and expenses on her tax return : calculate the amount of expenses Katie may deduct, and describe how she may report the income and expenses on her tax return.

Full months does the increased payment shave off the loan : How many full months does the increased payment shave off the loan?

User Account

All Pages