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Please answer ASAP Perdana Manufacturing is currently selling a product for RM20 per unit. All sales are on credit. Last year 120,000 units were sold.
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Perdana Manufacturing is currently selling a product for RM20 per unit. All sales are on credit. Last year 120,000 units were sold. Variable cost per unit is RM12. Total fixed costs are RM240,000. Perdana is deciding whether to relax its credit standards, which will increase unit sales by 5%; increase average collection period from 30 days to 45 days; and increase bad debts from 1% to 2% of sales. The company's opportunity cost of tying up funds in accounts receivable is 15%. Should Perdana Manufacturing relax its credit standardsStep by Step Solution
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