Purchase Solution

Estimating the annual savings due to lock-box arrangement

Not what you're looking for?

Ask Custom Question

Community Hospital has annual net patient revenues of $150 million. At the present time, payments received by the hospital are not deposited for six days on average. The hospital is exploring a lock-box arrangement that promises to cut the six days to one day. If these funds released by the lock-box arrangement can be invested at 8 percent, what will the annual savings be? Assume the bank fee will be $2,000 per month.

Purchase this Solution

Solution Summary

Solution depicts the steps to estimate the annual savings due to proposed lock-box arrangement.

Solution Preview

Please refer attached file for better clarity of calculations.

Annual net patient revenues=AR=$150,000,000
Assume working ...

Solution provided by:
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
Recent Feedback
  • "Thank you"
  • "Really great step by step solution"
  • "I had tried another service before Brain Mass and they pale in comparison. This was perfect."
  • "Thanks Again! This is totally a great service!"
  • "Thank you so much for your help!"
Purchase this Solution

Free BrainMass Quizzes
Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.

Writing Business Plans

This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations


This tests some key elements of major motivation theories.


This Quiz is compiled of questions that pertain to IPOs (Initial Public Offerings)