Fahmi Enterprise has a cash-only sales policy.It is considering changing to a credit policy of net 30
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Question:
Fahmi Enterprise has a cash-only sales policy.It is considering changing to a credit policy of net 30 days.Information related to the current and new policies is given in the table below.The required rate of return is 0.75 percent per month.
Current Policy New Policy
Price per unit (RM) 15.00 15.50
Cost per unit (RM) 8.00 8.40
Unit sales per month 2,000 2,050
Perform an analysis to show whether or not Fahmi Enterprise should adopt the new policy?
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