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A firm is considering several policy changes to increase sales. It will increase inventory by $10,000 it will offer more liberal sales terms but will
A firm is considering several policy changes to increase sales. It will increase inventory by $10,000 it will offer more liberal sales terms but will result in average receivables increasing by $65,000. These actions are expected to increase sales by $800,000 per year, and cost of goods will remain at 80% of sales. Because of the firms increased purchase of its won production needs, average payable increases by $35,000.What factors should they consider when making these decisions? What effects would they have on the firms cash cycle? Please select three financial ratios they should consider and why
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