Your Firm Currently Sells 500 Units a Month at a Price

Multiple Choice

Your firm currently sells 500 units a month at a price of $75 a unit. You think you can increase your sales by an additional 130 units if you switch to a net 30 credit policy. The monthly interest rate is.4 percent and your variable cost per unit is $35. What is the incremental cash inflow from the proposed credit policy switch?

A) $1,800
B) $2,400
C) $3,600
D) $5,200
E) $6,000