Mako Industries has annual credit sales of $2,000,000. Current expenses for the collection department are $50,000, bad-debt losses are 1.00%, and the DSO is 25 days. The firm is considering easing its collection efforts such that collection expenses will be reduced to $35,000 per year. The change is expected to increase bad-debt losses to 2.00% and to increase DSO to 45 days. In addition, sales are expected to increase to $2,425,000. What would be the impact on net income if the firm adopted this new credit policy if the opportunity cost of funds is 12%, the variable cost ratio is 75%, and taxes are 25%? (10