Under its current cash sales-only policy JJ sells 186 units per month at a price of $330. the variable costs per unit $155 and the monthly interest rate is 1.3%. The firm believes it can sell an additional 25% per month if it offers a net 30 credit policy. What is the net present value of the switch using the one-shot approach A. $291,543 B. $271,283 C. $312,806 D. $288,946 E. $311,118

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Q: I need the second Req please! Thank you.

A: Solution Cost of production refers to the all the costs that are involved when a company offers a…

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Q: Policy $168 132 1,290 1.5%

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A: NPV is also known as Net Present Value. It is a capital budgeting technique which helps in decision…

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A: The incremental cash flow=(Price per unit-Variable cost per unit)×Number of additional units

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A: Cash outflow (immediate) = $95,200Cash inflow after 1 year = $96,900Cost of capital = 8.1%

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.