Asked by Vickie Feazelle on Jul 22, 2024
Verified
Explain how a lockbox system would be operated and why a firm might consider implementing such a system.
Lockbox System
A service offered by banks to companies for receiving payments from customers; the bank collects and processes these payments directly to speed up the deposit process.
Firm Implementation
The process of putting a business strategy or plan into action to achieve its goals and objectives.
- Explain the operation and benefits of a lockbox system for a firm.
Verified Answer
LS
LivingLifeWith SuperiorJul 24, 2024
Final Answer :
At each of those sites, a representative from a local bank collects the cheques and deposits them into the firm's account. The firm can then make transfers from the remote accounts into more centralized accounts. The system reduces mailing and processing times, and creates a one-time cash inflow for the firm.
Learning Objectives
- Explain the operation and benefits of a lockbox system for a firm.