Problem:
Blake Company has 3400 hourly workers. They work 40 hours a week, at the rate of $7.00 an hour and they are paid every Friday. The company has decided to pay them twice a month. The cost of printing and processing each check is $1.25. The cost of capital to the company is 14%.
Required:
Question: Find the present value of the annual savings created by this decision and the value added to the company by this procedure.
Note: Can someone please give me a step by step solution?