Example of Relaxing the credit period Profitability of (5 contribution x(10,000 units) additional sales 50000 Additional ($250,000 sales)/(6 Turns)= receivables $41,667 Investment in add ($20/$25)X($41,667)= receivables(new sales)$33, 334 revIous $2,000,000 sales)/(12 Turns) receivable leve $166667 10-1310-13 Example of Relaxing the Credit Period Profitability of ($5 contribution)x(10,000 units) = additional sales $50,000 Additional ($250,000 sales) / (6 Turns) = receivables $41,667 Investment in add. ($20/$25) x ($41,667) = receivables (new sales) $33,334 Previous ($2,000,000 sales) / (12 Turns) = receivable level $166,667