What is the most tennindo would pay for credit screening

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Question - Tennindo, Inc. is starting up its? new, cost-efficient gaming system? console, the yuu. Tennindo currently has 4,500 ?cash-paying customers and makes a profit of ?$70 per unit. Tennindo wants to expand its customer base by allowing customers to buy on credit. It estimates that credit sales will bring in an additional 1,200 customers per? year, but that there will also be a default rate on credit sales of 5?%. It costs ?$240 to make a? yuu, which retails for ?$310.

If all customers? (old and? new) buy on? credit, what is the cost of bad debt without credit? screening? What is the most Tennindo would pay for credit screening that accurately identifies? bad-debt customers prior to the? sale? What are the increased profits from adding credit sales for customers with and without credit? screening? Should Tennindo offer credit sales if credit screening costs ?$10 per? customer?

Reference no: EM133165653

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