Cow Chips, Incorporated, a large fertilizer distributor based in California, is planning to use a lockbox system to speed up collections from its customers located on the East Coast. A Philadelphia-area bank will provide this service for an annual fee of $12,000 paid at the end of the year plus 5 cents per transaction. The estimated reduction in collection and processing time is one day. Treasury bills are currently yielding 5 percent per year, and there are 365 days per year. If the average customer payment in this region is $5,900, how many customers each day, on average, are needed to make the system profitable for Cow Chips? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Number of customers per day
Cow Chips, Incorporated, a large fertilizer distributor based in California, is planning to use a lockbox system to speed up collections from its customers located on the East Coast. A Philadelphia-area bank will provide this service for an annual fee of $12,000 paid at the end of the year plus 5 cents per transaction. The estimated reduction in collection and processing time is one day. Treasury bills are currently yielding 5 percent per year, and there are 365 days per year. If the average customer payment in this region is $5,900, how many customers each day, on average, are needed to make the system profitable for Cow Chips? (Do not round Intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Number of customers per day
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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![Cow Chips, Incorporated, a large fertilizer distributor based in California, is planning to
use a lockbox system to speed up collections from its customers located on the East
Coast A Philadelphia-area bank will provide this service for an annual fee of $12,000
pald at the end of the year plus 5 cents per transaction. The estimated reduction in
collection and processing time is one day. Treasury bills are currently yielding 5 percent
per year, and there are 365 days per year. If the average customer payment in this
region is $5,900, how many customers each day, on average, are needed to make the
system profitable for Cow Chips? (Do not round Intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
Number of customers
per day](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1ea525ec-f844-479e-8913-002f3e2a66fa%2Fb5205f31-cf1b-4f0b-8995-3cb785e932e2%2F8amk0nn_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Cow Chips, Incorporated, a large fertilizer distributor based in California, is planning to
use a lockbox system to speed up collections from its customers located on the East
Coast A Philadelphia-area bank will provide this service for an annual fee of $12,000
pald at the end of the year plus 5 cents per transaction. The estimated reduction in
collection and processing time is one day. Treasury bills are currently yielding 5 percent
per year, and there are 365 days per year. If the average customer payment in this
region is $5,900, how many customers each day, on average, are needed to make the
system profitable for Cow Chips? (Do not round Intermediate calculations and round
your answer to 2 decimal places, e.g., 32.16.)
Number of customers
per day
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