Billings Village is considering shifting its payroll period from twice a month to monthly. Total payroll for the year is $80 million. Billings can earn 6% on its invested money. How much would the village save from such a change? Should it shift its payroll period to monthly.
Total payment when payment twice a month is 24 (2*12)
That means company pays on average 80,000,000/24 = $3,333,333 per pay cycle.
If company delays this ...
The solution find our the saving if the payroll is change from twice a month to monthly.