70. Increasing the credit period from 30 to 60 days, in response to a similar action taken by all of our competitors, would likely result in:

a) an increase in the average collection period.

b) a decrease in bad debt losses.

c) an increase in sales.

d) higher profits.

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71. The credit policy of Spurling Products is "1.5/10, net 35." At present 30% of the customers take the discount, 62% pay within the net period, and the rest pay within 45 days of invoice. What would receivables be if all customers took the cash discount?

a) Lower than the present level.

b) No change from the present level.

c) Higher than the present level.

d) Unable to determine without more information.

72. An increase in the firm's receivable turnover ratio means that:

a) it is collecting credit sales more quickly than before.

b) cash sales have decreased.

c) it has initiated more liberal credit terms.

d) inventories have increased.