Question 1 the time necessary for a deposited check to, Ask an Expert

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Question 1. The time necessary for a deposited check to clear through the commercial banking system causes which of the following types of floats?

a. mail

b. processing

c. transit

d. disbursing

Question 2. One advantage of zero balance accounts is an increase in disbursing float.

a. True

b. False

Question 3. Flashbinder Guitars, Inc. is considering a lockbox system that will increase its check processing cost by $.20 per check. The company estimates an average check size of $900 and expects any funds freed up by the new lockbox system can be invested in an account that earns 4% per year before taxes. What reduction in collection time is necessary for the lockbox to be beneficial to Flashbinder Guitars Inc.?

a. 1.96 days

b. 2.03 days

c. 1.73 days

d. 2.15 days

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M92574255

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