Currently, OET Corporation sells 350,000 units of widgets a month at a price of $21 a unit. The company currently has a net 30 credit policy. Mr. Ent, the company's financial manager, is evaluating a new credit policy of net 60 for the company. The marketing manager thinks that sales would increase by 10,000 units per month if the company were to switch to the new credit policy. The APR for OET is 13% compounded monthly, and its variable cost per widget is $12. Ignore taxes.

Tomorrow, Mr. Ent will be making a presentation on the new proposed credit policy to the CEO of OT. He will be expected to provide answers to the following questions

Briefly discuss the three components of a good credit policy.

Answer rating: 100% (QA)

Credit standards refer to the criteria used to evaluate the credit worthiness of potential customers Factors such as the customer s credit history credit score financial statements and current financi... View the full answer