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The Boyd Corporation has annual credit sales of $1.95 million.Current expenses for the collection department are $31,000,bad-debt losses are 1.7%, and the days sales outstanding is 30days. The firm is considering easing its collection efforts suchthat collection expenses will be reduced to $25,000 per year. Thechange is expected to increase bad-debt losses to 2.7% and toincrease the days sales outstanding to 45 days. In addition, salesare expected to increase to $1,975,000 per year. Suppose that theopportunity cost of funds is 19%, the variable cost ratio is 80%,and taxes are 40%. Assuming a 365-day year, calculate the cost ofcarrying receivables under the current policy and the new policy.Enter your answers as positive values. Do not round intermediatecalculations. Round your answers to the nearest dollar. Currentpolicy: $ New policy: $ Should the firm relax collectionefforts?