Bowral Holiday Hobbies Ltd plans to sell toy cars
Part A: Bowral Holiday Hobbies Ltd plans to sell toy cars over the internet and by mail order. Bowral Holiday Hobbies Ltd buys the toy cars for $24 and sells them for $32. If payment by cheque accompanies the mail orders (estimated to be 50 per cent of sales), Bowral Holiday Hobbies Ltd gives a 10 per cent discount. If customers include a credit card number for internet or mail order sales (20 per cent of sales), customers receive a 5 per cent discount. The remaining collections are estimated to be: • One month following 12% • Two months following 8% • Three months following 6% • Uncollectable 4% Bowral Holiday Hobbies Ltd has forecasted the following sales volumes: • June…
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