A manufacturer currently prices its product at 10 $. per unit. Last year, the manufacturer...
90.2K
Verified Solution
Link Copied!
Question
Finance
A manufacturer currently prices its product at 10 $. per unit. Last year, the manufacturer sold 60.000 units. The variable cost per unit is 6 $. . Total fixed costs are 120.000 $. . The manufacturer intends to increase sales by 5%. Current accounts receivable collection period is 30 days. If the manufacturer wants to relax its credit standards, the expectation is that bad debt expenses will increase from 1% of sales to 2% of sales. The opportunity cost of investing in accounts receivables is 15%. In order to benefit from relaxing its credit standards, what would be the expected maximum accounts receivable collection period? (Assume that existing customers are not expected to alter their payment habits. 1 year = 365 days)
82,38 days
63,33 days
105,82 days
63,73 days
Other:
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
