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A firm with sales of $10,000,000 has inventory of $1,000,000. All sales are on credit, and the receivables are collected within 40 days. You are

A firm with sales of $10,000,000 has inventory of $1,000,000. All sales are on credit, and the receivables are collected within 40 days. You are willing to sell inventory to the firm on credit provided that you be paid within 60 days. Should you sell to this firm on credit? Explain how you derived your answer.

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