(Answered) Credit policy wilder corporation is considering granting

Finance

Credit Policy. Wilder Corporation is considering granting credit to currently limited customers or no-credit customers. The following information is given:

Category	Bad Debt Percentage	Collection Period	Credit Terms	Incremental Annual Sales Accompanying Relaxation in Credit Standards ($)
A	3	20 days	Full	250,000
B	6	45 days	Restricted	540,000
C	10	90 days	No credit	800,000

Gross profit approximates 12 percent of sales. The rate of return is 18 percent. Should credit be extended to categories B and C?

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