Ebbert, Inc., is considering a change in its cash only sales policy. The new terms of sale
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Ebbert, Inc., is considering a change in its cash only sales policy. The new terms of sale would be net one month. Based on the following information, determine if Ebbert should proceed or not. Describe the buildup of receivables in this case. The required return is 1.5 percent per month.
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Price per unit Cost per unit Unit sales per month Current Policy $ 750 $ 400 1,100 New Policy $ 750 $ 400 1,220
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Profit Analysis Current Policy Profit per unit 750 400 350 Total profit 350unit 1100 units 385000 Ne...View the full answer
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Related Book For
Fundamentals Of Corporate Finance
ISBN: 9780072553079
6th Edition
Authors: Stephen A. Ross, Randolph Westerfield, Bradford D. Jordan
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