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  A firm is contemplating shortening its credit period from 45 to 35 days and believes​ that,...

  A firm is contemplating shortening its credit period from 45 to 35 days and believes​ that, as a result of this​ change, its average collection period will decline from 51 to 43 days. ​ Bad-debt expenses are expected to decrease from 1.6 % to 1.1 % of sales. The firm is currently selling 11,900 units but believes that as a result of the proposed​ change, sales will decline to 9,900 units. The sale price per unit is $ 55 ​, and the variable cost per unit is $ 45 . The firm has a required return on​ equal-risk investments of 11.9 % . Evaluate this​ decision, and make a recommendation to the firm.  ​(Note​: Assume a​ 365-day year.)

The reduction in profit contribution from a decline in sales is

​$ ​(Roundto the nearest dollar. Enter as a negative​number.)

The benefit from the reduced marginal investment in​A/Ris

​$

The cost savings from the reduction in bad debts is

​$

The net profit or loss from implementing the proposed plan is

​$

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