the millers want to extend the credit

edit period terms to net 60 days. They expect a reaction from com petitors, but they believe such a move would produce the following results: 1. Sales are expected to increase to 5,000 units. 2. Bad debt losses are expected to increase by $2,000 per year. The cost per unit for the increased number of units produced would be $6.50. The company's income tax rate is 35%, and its required minimum rate of return is 16% after tax. A company is planning to change its credit policy. The details are as follows: $5.00 per Current selling price Average cost Current annual sales Current terms of sale unit $4.50 per unit 360,000 units net 30 days The company wants to extend its credit period to net 60 days. Allowing for the reaction of competitors, it is anticipated that this move would produce the following results: 1. Sales are expected to increase to 420,000 units. 2. Bad debt losses are expected to increase by $6,000 per year. The marginal cost per unit for the increased number of units to be produced would be $3.00. The company's after-tax rate is 40%, and its required minimum rate of return on such investments is 15% after tax. edit period terms to net 60 days. They expect a reaction from com petitors, but they believe such a move would produce the following results: 1. Sales are expected to increase to 5,000 units. 2. Bad debt losses are expected to increase by $2,000 per year. The cost per unit for the increased number of units produced would be $6.50. The company's income tax rate is 35%, and its required minimum rate of return is 16% after tax. A company is planning to change its credit policy. The details are as follows: $5.00 per Current selling price Average cost Current annual sales Current terms of sale unit $4.50 per unit 360,000 units net 30 days The company wants to extend its credit period to net 60 days. Allowing for the reaction of competitors, it is anticipated that this move would produce the following results: 1. Sales are expected to increase to 420,000 units. 2. Bad debt losses are expected to increase by $6,000 per year. The marginal cost per unit for the increased number of units to be produced would be $3.00. The company's after-tax rate is 40%, and its required minimum rate of return on such investments is 15% after tax