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Question 1 (15 marks) Happy Times Corporation currently has an all cash credit policy. It is considering making a change in its credit policy. The
Question 1 (15 marks) Happy Times Corporation currently has an all cash credit policy. It is considering making a change in its credit policy. The new terms would be net 30 days. Current Policy New Policy Price per unit $82 $84 Cost per unit $43 $43 Unit sales per month 4,150 4.380 (a) Based on the information above, determine if Happy Times should proceed or not. The required return is 3 percent per month. (9 marks) (b) What is the break-even quantity for the new credit policy? (3 marks) (c) What is the break-even price per unit under the new credit policy? Assuming all other values remain the same
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