Accounts receivable changes Tara's Textiles currently has credit sales of $22 million per month, an average collection period of 65 days, and bad debts equal to 4% of sales. Assume that the price of Tara's products is $50 per unit and that the variable costs are $45 per unit. The firm is considering tightening up their credit policy, allowing customers 37 days rather than 65 to pay their bills. With a stricter credit policy in place, sales will fall by 10%, but the average collection period will drop to 37 days and the bad debts percentage will fall to 1%. Determine whether the company should make this change if their cost of capital is 0.9% per month. (Note: Use a 365-day year.) The cost from a decrease in sales is $ (Round to the nearest dollar.) The additional profit from the decreased marginal investment in A/R is $ (Round to the nearest dollar.) The additional profit from the decrease in bad debts is $ (Round to the nearest dollar.) The net profit or loss from implementing the proposed plan is $ (Round to the nearest dollar. Enter a negative number for a loss.) Is the proposed plan recommended? (Select from the drop-down menu.)