Your firm generally receives 3 cheques a month. A month is defined as a 30-day period....

Your firm generally receives 3 cheques a month. A month is defined as a 30-day period. The cheque amounts and the collection delay for each cheque are: $8,100 with a delay of 3 days; $6,800 with a delay of 4 days; and $2,300 with a delay of 2 days. What is the amount of the average daily float?

Solutions

Expert Solution

Average daily float = (Average amount of checks received per day * Average number of days delay) / Number of days in a month

Average daily float = [($8,100 * 3) + ($6,800 * 4) + ($2,300 * 2)] / 30

Average daily float = $1,870

jeff jeffy answered 2 years ago

Next > < Previous

Related Solutions

In a typical month, Kids Fun’s Playground Company receives 45 cheques totalling $16,000. These cheques are...

In a typical month, Kids Fun’s Playground Company receives 45 cheques totalling $16,000. These cheques are delayed two days on average. What is the average daily float if there is 30 days in a month?

Trish receives $480 on the first day of each month. Josh receives $480 on the last...

Trish receives $480 on the first day of each month. Josh receives $480 on the last day of each month. Both Trish and Josh will receive monthly payments for next 3 years. At a 9.5 percent annual rate, compounded monthly, what is the highest present value amount?

How is a neurotransmitter generally defined? Your answer will list 3 primary elements and two approaches...

How is a neurotransmitter generally defined? Your answer will list 3 primary elements and two approaches used to define a neurotransmitter 1. 2. 3. 4. 5.

your firm receives three checks that have a two and a half-day collection delay. each check...

your firm receives three checks that have a two and a half-day collection delay. each check is worth 15809, 16121, and 14690, respectively. if there are 30 days in the month, what is the average daily float for your firm? A) 2351 B) 3971 C) 3289 D) 1526 E) 3885

The Marlow Sales and Distribution Co. needs $460,000 for the 3-month period ending September 30, 2015....

The Marlow Sales and Distribution Co. needs $460,000 for the 3-month period ending September 30, 2015. The firm has explored two possible sources of credit. a. Marlow has arranged with its bank for a $460,000 loan secured by its accounts receivable. The bank has agreed to advance Marlow 75 percent of the value of its pledged receivables at a rate of 12 percent plus a 1 percent fee based on all receivables pledged. Marlow's receivables average a total of $1...

Your firm currently sells 2000 units a month at a price of $30 a unit. You...

Your firm currently sells 2000 units a month at a price of $30 a unit. You think you can increase your sales by an additional 20 units if you switch to a net 30 credit policy. The monthly interest rate is 0.5 percent and your variable cost per unit is $18. What is the net present value of the proposed credit policy switch? What is the necessary increase in unit sales to breakeven?

Assume that today is the first day of the month and that it is also your...

Assume that today is the first day of the month and that it is also your first day of retirement. You have saved for retirement over the years and have accumulated $310,000 in an investment account from which you plan to make monthly withdrawals during your retirement starting at the end of this month. Assuming you can earn annual returns of 6.4% in your investment account during your retirement years, how much money can you withdraw every month to make...

Shortening the credit period A firm is contemplating shortening its credit period from 40 to 30...

Shortening the credit period A firm is contemplating shortening its credit period from 40 to 30 days and believes that, as a result of this change, its average collection period will decline from 46 to 35 days. Bad-debt expenses are expected to decrease from 1.7% to 0.9% of sales. The firm is currently selling 11,500 units but believes that as a result of the proposed change, sales will decline to 9,600 units. The sale price per unit is $58,...

Each month, the Sports Exports Company (a U.S. firm) receives an order for footballs from different...

Each month, the Sports Exports Company (a U.S. firm) receives an order for footballs from different British sporting goods distributors. The monthly payment for the footballs is denominated in British pounds, as requested by the British distributor. Jim Logan, owner of the Sports Exports Company, must convert the pounds received into dollars. 1. Explain how a higher level of inflation in UK affect Sports Exports Company (assume U.S, inflation remains constant. 2. How could a decreasing level of national income...

a) Harris News receives payments on 3-month newspaper subscriptions of $9,000 on December 1. On December...

a) Harris News receives payments on 3-month newspaper subscriptions of $9,000 on December 1. On December 1, Harris debits Cash $9,000 and credits Revenue $9,000. Adjusting entries are prepared monthly. At December 31, Harris will _______ Revenue for__________. **Show all steps/work in determining revenue amount. b) Total Fitness Inc. sells $6,000 worth of 1-year club memberships on August 1, Year 1.Total Fitness's fiscal year ends December 31. The balance in the Unearned Revenue account at December 31, Year 1 is_______?...

Subjects