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Business, 20.09.2019 01:20 lucilita2017

Fast turnstiles co. is evaluating the extension of credit to a new group of customers. although these customers will provide $252,000 in additional credit sales, 8 percent are likely to be uncollectible. the company will also incur $16,600 in additional collection expense. production and marketing costs represent 75 percent of sales. the firm is in a 35 percent tax bracket and has a receivables turnover of five times. no other asset buildup will be required to service the new customers. the firm has a 12 percent desired return. a-1. calculate the incremental income after taxes.

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