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Kozmetika Corporation is considering a switch from its current cash sales only policy to a net 30 policy. The company is currently selling 800,000 units
Kozmetika Corporation is considering a switch from its current cash sales only policy to a net 30 policy. The company is currently selling 800,000 units per month with selling price of SG$ 180,000 per unit. The new policy is expected to boost sales by 25 percent units at a price of SG$ 200.000 per unit. However, the variable cost per unit will also increase by 10 percent from its current level of SG$ 165.000. If the company's required return is 2.5 percent per month, should the company proceed with the plan or not?
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