BB currently has average collection period of 37 days, annual sales of 330,000 units at a...
BB currently has average collection period of 37 days, annual sales of 330,000 units at a selling price of $30 a piece, and contribution margin $18. It is considering a tightening of credit policy that would reduce average collection period to 21 days and reduce sales to 328,000 units. There are no bad debts, and BB has required return of 7%. What is the net profit from tightening the credit policy?
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BB currently has average collection period of 37 days, annual
sales of 330,000 units at a...
Forrester Fashions has annual credit sales of 250,000 units with an average collection period of 70...
Forrester Fashions has annual credit sales of 250,000 units with an average collection period of 70 days. The company has a per-unit variable cost of $20 and a per-unit sale price of $30.00. Bad debts currently are 5% of sales. The firm estimates that a proposed relaxation of credit standards would not affect its 70-day average collection period but would increase bad debts to 7.50% of sales. which would increase to 300,000 units per year. Forrester requires a 12% return...
Forrester Fashions has annual credit sales of 250,000 units with an average collection period of 70 days. The company h...
Forrester Fashions has annual credit sales of 250,000 units with an average collection period of 70 days. The company has a per-unit variable cost of $20 and a per-unit sale price of $30. Bad debts currently are 5% of sales. The firm estimates that a proposed relaxation of credit standards would not affect its 70-day average collection period but would increase bad debts to 7.5% of sales, which would increase to 300,000 units per year. Forrester requires a 12% return...
Question Help Accounts receivable changes without bad debts Tara's Textiles currently has credit sales of $363...
Question Help Accounts receivable changes without bad debts Tara's Textiles currently has credit sales of $363 million per year and an average collection period of 59 days Assume that the price of Tara's products is 560 per unit and that the variable costs are $55 per unit. The firm is considering an accounts receivable change that will result in a 20.3% increase in sales and a 19 2% increase in the average collection period No change in bad debts is...
Darla’s Cosmetics has annual credit sales of $1,314,000 and an average collection period of 45 days...
Darla’s Cosmetics has annual credit sales of $1,314,000 and an average collection period of 45 days in 2008. What is the company’s average accounts receivable balance? (Use a 360-day year.)
vable changes without bad debts Tara's Textiles currently has credit sales of $361 million per year...
vable changes without bad debts Tara's Textiles currently has credit sales of $361 million per year and an average collection period of 60 days. Assume that the price of Tara's products is $59 per unit and that the variable costs are $54 per unit. The firm is considering an accounts receivable change that will result in a 20.6 % increase in sales and a 19.6 % increase in the average collection period. No change in bad debts is expected. The...
Q58: Geoffrey’s Toy Box currently has sales of $1,000,000, and its days sales outstanding is 30...
Q58: Geoffrey’s Toy Box currently has sales of $1,000,000, and its days sales outstanding is 30 days. The new CFO estimates that offering longer credit terms would (1) increase the days sales outstanding to 50 days and (2) increase sales to $1,200,000. However, bad debt losses, which were 2% on the old sales, would increase to 5 percent on the incremental sales while bad debts on the old sales would stay at 2 percent. Variable costs are 80 percent of...
Starset, Inc., has an average collection period of 50 days. Its average daily investment in receivables...
Starset, Inc., has an average collection period of 50 days. Its average daily investment in receivables is $44,300. Assume 365 days per year. a. What is the receivables turnover? (Do not round intermediate calculations and round your answer to 4 decimal places, e.g., 32.1616.) b. What are annual credit sales? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) The Snedecker Corporation is considering a change in its cash-only policy. The new terms would...
QUESTION 10: A company has an average collection period of 21 days. The firm’s annual credit...
QUESTION 10: A company has an average collection period of 21 days. The firm’s annual credit sales total $23,389,300. Calculate the firm’s accounts receivable. $1,345,686 $2,012,012 $1,946,090 $1,648,567 none of these QUESTION 11: A firm has an ROE of 18% and a ROA of 12%. What would the equity multiplier (leverage) be? .883 1.02 1.5 20 none of these
current ratio?average collection period?days sales in inventory?debt ratio?profit margin?Use the following...
current ratio?average collection period?days sales in inventory?debt ratio?profit margin?
Accounts receivable changes without bad debts Tara's Textiles Currently has credit sales of $359 million per...
Accounts receivable changes without bad debts Tara's Textiles Currently has credit sales of $359 million per year and an average collection period of 64 days Assume that the price of Tara's products is $60 per unit and that the variable costs are $54 per unit. The firm is considering an accounts receivable change that will result in a 202% increase in sales and a 19 6% increase in the average collection period. No change in bad debts is expected. The...
Forrester Fashions has annual credit sales of 250,000 units with an average collection period of 70 days. The company has a per-unit variable cost of $20 and a per-unit sale price of $30.00. Bad debts currently are 5% of sales. The firm estimates that a proposed relaxation of credit standards would not affect its 70-day average collection period but would increase bad debts to 7.50% of sales. which would increase to 300,000 units per year. Forrester requires a 12% return...
Question Help Accounts receivable changes without bad debts Tara's Textiles currently has credit sales of $363 million per year and an average collection period of 59 days Assume that the price of Tara's products is 560 per unit and that the variable costs are $55 per unit. The firm is considering an accounts receivable change that will result in a 20.3% increase in sales and a 19 2% increase in the average collection period No change in bad debts is...
vable changes without bad debts Tara's Textiles currently has credit sales of $361 million per year and an average collection period of 60 days. Assume that the price of Tara's products is $59 per unit and that the variable costs are $54 per unit. The firm is considering an accounts receivable change that will result in a 20.6 % increase in sales and a 19.6 % increase in the average collection period. No change in bad debts is expected. The...
current ratio?average collection period?days sales in inventory?debt ratio?profit margin?
Accounts receivable changes without bad debts Tara's Textiles Currently has credit sales of $359 million per year and an average collection period of 64 days Assume that the price of Tara's products is $60 per unit and that the variable costs are $54 per unit. The firm is considering an accounts receivable change that will result in a 202% increase in sales and a 19 6% increase in the average collection period. No change in bad debts is expected. The...
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