2 to 3 #t SEDE XIA 2. The Westtown Corp. has obtained the following information: Annual Credit sales = $30 million Collection period= 60 days Terms: Net 30 Interest rate= 12% The company is considering offering terms of 3/10, net 30. It anticipates that 50 percent of its customers will take advantage of the discount. The collection period should decrease by one month. a. Should the new credit policy be adopted? (There is no change in sales so there is no need to use the COGS portion of the equation.) Do your calculations and state your recommendation. b. If DSI is 25 days what is the effect on PV of the decision? Do your calculations and state your recommendation. C. If bad debt losses are 6% under the current policy but should decrease to 3% overall with the new policy what is the impact on the final decision? Provide details of your analysis. Do your calculations and state your recommendation. If you make assumptions, they must be stated and clearly applied. Gm