Flowers Incorporated is investigating a lockbox system to reduce its collection time.
The firm receives an average of 400 payments per day with an average value of
\$3,900. The bank will change a lockbox fee of \$.80 per transaction and the
applicable daily interest rate is .03 percent. What is the NPV of adopting the lockbox
system if the system reduces collection time by two days?
A) \$2,600,000
B) \$2,695,000
C) \$2,745,000
D) \$2,053,333
E) \$2,675,000