PT. Serendipity is a company that produces shoes and currently applies a cash-only salespolicy. In this new year's holiday season, the company is considering changing its cash-onlysales policy to a net 45-day credit. The new credit policy is expected to increase sales from1200 units per month to 1350 units per month. The current selling price per unit and variablecost per unit are IDR 175.000 and IDR 100.000, respectively. However, if the product is soldon credit, the selling price per unit and the variable cost per unit will remain constant. Therequired return is 3% per month.Based on the above information, calculate the NPV of the new credit policy! Should PT.Serendipity change its sales policy?

NPV is difference between the present value of future cash flow and initial investment.

Serendipity is a company that produces shoes and currently applies a cy. In this new year's holiday season, the company is considering changir s policy to a net 45-day credit. The new credit policy is expected to iner ) units per month to 1350 units per month. The current selling price per u per unit are IDR 175.000 and IDR 100.000, respectively. However, if the credit, the selling price per unit and the variable cost per unit will remai ired return is 3% per month.

Serendipity is a company that produces shoes and currently applies a cy. In this new year's holiday season, the company is considering changir s policy to a net 45-day credit. The new credit policy is expected to iner ) units per month to 1350 units per month. The current selling price per u per unit are IDR 175.000 and IDR 100.000, respectively. However, if the credit, the selling price per unit and the variable cost per unit will remai ired return is 3% per month.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 35P

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