Please note that the subject is Financial Management. Course hero only shows courses like finance and financial Accounting.

I really need help with this question.

Problem: Manning Alternatives currently sells to its customers on terms of 2/10, net 30.

Its average collection period is 14 days, with 85% currently taking the discount. All sales are credit sales. Upper management has expressed concern about sluggish sales, and the marketing department would like a more attractive credit package. Next year's sales are projected to be $2,600,000. It has been estimated with terms of 3/10, net 60, sales next year would jump to $3,500,000 and 65% of sales would take discount, but the average collection period would increase to 31 days. Manning's contribution margin of 5% would hold this expansion of sales, as would its short-term financing cost of 11%. Should Manning Alternatives initiate the change in credit policy?