Lewis Enterprise is considering relaxing its credit standards to increase it currently staffing sales. As a result of the proposed relaxation, sales are expected to increase by 10% from 10,000 to $11,000 units during the coming year; the average collection period is expected to increase from 45 to 60 days; and bad debts are expected to increase from 1% to 3% of sales. The sale price per unit is $40, and the variable cost per unit is $31. The firm’s required return on equal-risk investments is 25%. Evaluate the proposed relaxation and make a recommendation to the firm. (Note: Assume a 365-day year.)