- 14 Berkshire Sports Inc Operates A Mail Order Running Shoe Business Management Is Considering Dropping Its Policy Of 1 (39.36 KiB) Viewed 28 times
14. Berkshire Sports, Inc., operates a mail-order running shoe business Management is considering dropping its policy of
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14. Berkshire Sports, Inc., operates a mail-order running shoe business Management is considering dropping its policy of
14. Berkshire Sports, Inc., operates a mail-order running shoe business Management is considering dropping its policy of no credit. The credit policy under consideration by Berkshire follows: Dec 31 20X1. Dec. 31 20X2 Price Per Unit $35 $40 Cost Per Unit $25 $32 Quantity Sold 2,000 3,000 I Probability of Payment 100% 85% Credit Period 0. 1 Discount rate 0 3% (@) Should Berkshire offer credit to its customers? (b) What must the probability of payment be before Berkshire would adopt the policy?