MRT Traders Ltd. sells its products through a widely distributed dealer network, allowing a credit period of 15 days only. The average variable cost is 60% of sales value and current sales amount to Rs.100 lakhs. In order to meet growing competition, the firm is trying to revamp its marketing strategy. This entails changing credit period suitably and also increase sales promotion expenses which will increase the fixed costs. You are required to analyse the above details in a suitable format and suggest the best strategy for the firm. Additional funds, if any, can be raised by the firm at a cost of 16%. Consider 360 days in a year. The marketing department has given the following estimates for the various options, along with current policy:

TABLE 1

Particulars	Current	Option I	Option II	Option III
Credit period (months)	0.5	1	1.5	2
Sales Rs. Lakhs per annum	100	120	135	150
Fixed costs Rs. Lakhs per annum	15	18	20	24
Bad Debts % of Sales	1	1.5	2	3