Please answer question #2

Gardner, Icffrey Steven G Review Share Comments Comprehensive_Problem 2 FALL_2020 - Protected View - Saved to this BC- Search File Home Insert Draw Design Layout References Mailings View Help RCM PROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's sater to stay in Protected View Enable Editing 1) Compute the incremental income after taxes that would result from these projections: X 2) Compute the incremental Return on Sales if these new credit customers are accepted: If the receivable turnover ratio is expected to be 3 to 1 and no other asset buildup is needed to serve the new customers. 3) Compute the additional investment in Accounts Receivable 4) Compute the incremental Return on New Investment 5) If your company requires a 20% Rate of Return on Investment for all proposals, do the numbers suggest that trade credit should be extended to these new customers? Explain. Proposal #2 would establish local collection centers throughout the region to decrease the time it takes to convert credit payments that are mailed in by check to cash. It is estimated that establishing these collection centers would reduce the average collection time by 2 days. 1) If the company currently averages $50,000 in collections per day, how many dollars will this suggested cash management system free up? 2) If all freed up dollars would be used to pay down debt that has an interest rate of 6%, how % much money could be saved each year in interest expense? 3) Do the numbers suggest that this new system should be implemented if its total annual cost is $80007 Explain. Screenshot Added A screenshot was added to your Dropbox Dropbox Page 1 of 1 364 words Type here to search EL A C 13/09/2020 Gardner, Icffrey Steven G Review Share Comments Comprehensive_Problem 2 FALL_2020 - Protected View - Saved to this BC- Search File Home Insert Draw Design Layout References Mailings View Help RCM PROTECTED VIEW Be careful-files from the Internet can contain viruses. Unless you need to edit, it's sater to stay in Protected View Enable Editing 1) Compute the incremental income after taxes that would result from these projections: X 2) Compute the incremental Return on Sales if these new credit customers are accepted: If the receivable turnover ratio is expected to be 3 to 1 and no other asset buildup is needed to serve the new customers. 3) Compute the additional investment in Accounts Receivable 4) Compute the incremental Return on New Investment 5) If your company requires a 20% Rate of Return on Investment for all proposals, do the numbers suggest that trade credit should be extended to these new customers? Explain. Proposal #2 would establish local collection centers throughout the region to decrease the time it takes to convert credit payments that are mailed in by check to cash. It is estimated that establishing these collection centers would reduce the average collection time by 2 days. 1) If the company currently averages $50,000 in collections per day, how many dollars will this suggested cash management system free up? 2) If all freed up dollars would be used to pay down debt that has an interest rate of 6%, how % much money could be saved each year in interest expense? 3) Do the numbers suggest that this new system should be implemented if its total annual cost is $80007 Explain. Screenshot Added A screenshot was added to your Dropbox Dropbox Page 1 of 1 364 words Type here to search EL A C 13/09/2020