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HPH Inc. just made a credit sale of 100,000. Collection on this credit sale will be delayed by the length of the operating cycle. The

HPH Inc. just made a credit sale of 100,000. Collection on this credit sale will be delayed by the length of the operating cycle. The CGS associated with this credit sale equal 50,000 and are delayed by days payable outstanding. Use the following information to calculate the increase in firm value that would occur by achieving the industry median cash flow timing given below

Current cash flow timing: DIH=40 days, DSO=60 days, DPO=30 days

Industry median cash flow timing: DIH=10 days, DSO=15 days, DPO=30 days

Discount rate 3.65%

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