Basically, the amount they earn per day from credit sales is x = 3240000/365, and over 3 days they lose x amount of money by not receiving those accounts. So under the lockbox system they can put in 3x dollars to be use as they see fit. And they will use that to get a 15% return. So the amount they earn from the lockbox is 15% of 3x over those 3 days, and that minus the $9000 cost is the net benefit.

What amount of cash will be made available for other uses under the lockbox system?

Question

Basically, the amount they earn per day from credit sales is x = 3240000/365, and over 3 days they lose x amount of money by not receiving those accounts. So under the lockbox system they can put in 3x dollars to be use as they see fit. And they will use that to get a 15% return. So the amount they earn from the lockbox is 15% of 3x over those 3 days, and that minus the $9000 cost is the net benefit.

What amount of cash will be made available for other uses under the lockbox system?