global services is considering a promotional campaign that willincrease annual credit sales by $570,000 the company will requireinvestments in accounts receivable, inventory, and plant andequipment. the turnover for each is as follows:

accounts receivable... 3x

inventory... 6x

plant and equipment... 1x

all $570,000 of the sales will be collectible. However,collection cost will be 3 percent of sales, and production andselling costs will be 70 percent of sales. The cost to carryinventory will be 6 percent of inventory. depreciation expense nplant and equipment will be 5 percent of plant and equipment. thetax rate is 30 percent.

A. compute the investments in accounts receivable, inventory,and plant and equipment based on the turover ratios. add the threetogether.

Accounts Receivable- ?

Inventory- ?

Plant and Equipment- ?

Total investment- ?

B. compute the accounts receivable collection costs andproduction and selling costs and add the two figures together.

Collection cost- ?

Production and selling cost- ?

total collection, production and selling cost- ?

C. Compute the costs of carrying inventory.

D. compute the depreciation expense on new plant andequipment.

E. Compute the total of all costs from parts B, C, and D.

F. Compute income after taxes.

G1. What is the after tax rate of return?