B) Tupperware Ltd, the leader in networking business in the country has been enjoying its status of market leader, and in a virtual monopolistic situation, has been selling on 100% cash basis. The emerging competition in the sector from new players 3 has forced the firm to revisit its terms of sales and company is evaluating two alternate credit policy options. The two options are: Particulars Credit Policy B Credit Policy A 1.0 2.5 Collection period (in months) Increase in Sales (in %) Bad Debts Losses (in %) 15.0 1.5 17.0 3.0 The current sales of the firm are Rs 400 lakhs and the total costs are Rs 312 lakhs. Which of the two policies should be chosen by Tupperware Ltd in case they want to maintain their current level of profitability? Assume that the firm's required return on investment in its receivables is 14%. [3+5 = 8]