What is the expected incremental profit associated with the

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Reference no: EM13621975

1. What is Lifelines' dollar cost of carrying receivables under the current policy? What would be the expected cost under the new policy? (Use a 360-day year.)

2. What is the expected incremental profit associated with the proposed change in credit terms? Should Lifelines make the change? (Hint: Construct income statements under each policy and focus on the expected change.

Reference no: EM13621975

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