Problem 6

A company is considering changing its credit policy with its customers and is planning to move from 5 to 4 times rotation. to 4 times; this would allow it to increase its sales level, which is currently at 2.4 billion. sales, which currently stand at 2.4 billion.

The projection made by the commercial department is that sales will increase by 10%. 10%. Given that this situation will require a greater investment in working capital and the idea is not to affect the company's liquidity (that the company's liquidity of the company (that the FCF is maintained and does not change as a result of this decision), it plans to sell part of the new portfolio through factoring. by Factoring part of the new portfolio that will be generated. The factoring company that would be The factoring company that would be willing to buy this portfolio is asking for an 18% discount factor.

If the company's operating margin is 30% and the tax rate is 25%, what should be the percentage of the portfolio that should be sold? should be the percentage of the portfolio that should be sold so as not to affect the FCF?

SUPPOSE: There are no changes in non-operating ER accounts or other non-portfolio assets. outside the portfolio.