BA 2103 - Financial Management End-of-Module 3 Assessment Working Capital Management Required: Written Analysis of the Case The following information are given for YOUR Corporation: Unit Selling Price P7.00 Unit Variable Cost P4.50 Fixed Cost per unit P1.50 Annual Credit Sales 40,000 units Collection Period 3 months Rate of Return 19% The business firm targets to increase its market share by adjusting its credit standards. With the new standards, the following changes are expected: Sales will increase by 25% Collection period will extend by one month Uncollectible accounts are estimated to be 4% on the incremental sales . Collection costs will increase by P3,400 Should the proposed change in credit standards be adopted? Justify. Support your answer with computations