Royal, Inc., is considering a change in its cash-only sales policy. The new terms of sale...

 

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Royal, Inc., is considering a change in its cash-only sales policy. The new terms of sale would be net one month. The required return is .64 percent per month. Current Policy Price per unit $ 780 New Policy $ 780 Cost per unit Unit sales per month $ 570 $ 570 840 890 Calculate the NPV of the decision to switch. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $ -700,106.25 Royal, Inc., is considering a change in its cash-only sales policy. The new terms of sale would be net one month. The required return is .64 percent per month. Current Policy Price per unit $ 780 New Policy $ 780 Cost per unit Unit sales per month $ 570 $ 570 840 890 Calculate the NPV of the decision to switch. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $ -700,106.25

Answer rating: 100% (QA)

To calculate the Net Present Value NPV of the decision to switch to the new policy we need to compar... View the full answer