In a lock-box system, who ultimately deposits payments into the business's account?

In a lock-box system, who ultimately deposits payments into the business's account?

• A. The customer
• B. The courier
• C. The account manager
• D. The bank

Answer: (D)

In a lockbox system, the bank is the one who ultimately deposits payments into the business's account. Customers mail their payments to a bank-managed lockbox, the bank collects and processes those payments, and then credits the business’s bank account. This setup speeds up cash flow and tightens control because the company never handles the payments directly. The customer’s role is to initiate payment, the courier just transports the mail, and the account manager handles internal posting, but the actual deposit into the business account is performed by the bank.

In a lockbox system, the bank is the one who ultimately deposits payments into the business's account. Customers mail their payments to a bank-managed lockbox, the bank collects and processes those payments, and then credits the business’s bank account. This setup speeds up cash flow and tightens control because the company never handles the payments directly. The customer’s role is to initiate payment, the courier just transports the mail, and the account manager handles internal posting, but the actual deposit into the business account is performed by the bank.