What is the NPV to Crisps of offering credit to BigBag

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Reference no: EM132173073

Question - Crisps has received an order for 14500 bags of potato chips from BigBag. Crisps views BigBag to be a one-time customer. Crisps sells its large bags of potato chips for $1.85 each, and calculates its internal cost for the product at $1.05 each.

Market research estimates that there is a 39% chance that BigBag will pay in full what it owes. Based on this information, what is the NPV to Crisps of offering credit to BigBag? Place your answer to the nearest dollar. Do not include a dollar sign or comma.

Reference no: EM132173073

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