Currently, The Toy Box sells 465 units a month at an average price of $39 a unit. The company thinks it can increase sales by an additional 130 units a month if it switches to a net 30 credit policy. The monthly interest rate is 0.4 percent and the variable cost per unit is $21. What is the incremental cash inflow of the proposed credit policy switch?
A) $2,120
B) $2,340
C) $2,200
D) $2,730
E) $5,070
Correct Answer:
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