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Henderson Office Supply is considering a more liberal credit policy to increase sales, but expects that 6 percent of the new accounts will be uncollectible.
Henderson Office Supply is considering a more liberal credit policy to increase sales, but expects that 6 percent of the new accounts will be uncollectible. Collection costs are 4 percent of new sales; production and selling costs are 79 percent; and accounts receivable turnover is four times. Assume income taxes of 35 percent and an increase in sales of $62,000. No other asset buildup will be required to support the increased sales activity. (a) What is the level of accounts receivable to support this sales expansion? (Omit the "$" sign in your response.) Investment in accounts receivable $ (b) What would be Henderson
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