A lock-box system reduces
A) mail float.
B) transit float.
C) disbursing float.
D) A and B

Question

Quizplus · Accepted Answer

A lock-box system is a process where a company's incoming payments are directed to a designated post office box, and a bank retrieves and processes the payments. This reduces both mail float and transit float, as payments are received more quickly and directly. Disbursing float, however, is not directly affected by lock-box systems.

A Lock-Box System Reduces