A company with annual sales of $$24,000,000$ is considering changing its payment terms from net $40$ to net $30$ to encourage customers to pay more promptly. The company forecasts that customers would respond by paying on day $34$ rather than day $44$ as at present $($assume a $360$ day year$)$ but would decrease their purchases by $$450,000$ per year. The company also forecasts that its idle cash balance would decrease by $$40,000$ and administrative costs would be reduced by $$35,000$ per year. The company's variable costs average $66\%$ of sales, it is in the $35\%$ marginal tax bracket, and it has an $9\%$ cost of capital.

Required:

A$.$ Calculate the incremental cash flows associated with accepting this proposal, and organize your cash flows into a cash flow spreadsheet of the type demonstrated in chapter $12$ of the textbook.

B$.$ Calculate the proposal's Net Present Value.

C$.$ Calculate the proposal's Internal Rate of Return.

D$.$ Calculate the proposal's Net Anhual Benefit.

E$.$ Explain whether the firm should shorten its payment terms or not.