Homework Answers
Answer to Requirement 1.
Cash Conversion Cycle = Days Inventory Outstanding + Days Sales
Outstanding – Days Payables Outstanding
Cash Conversion Cycle = 75 days + 30 days – 45 days
Cash Conversion Cycle = 60 days
Answer to Requirement 2.
Days Inventory Outstanding = Inventory * 365/ Cost of Goods
sold
75 days = Inventory * 365 / $350,000
Inventory = $71,917.81
Days Sales Outstanding = Accounts Receivable * 365 / Sales
30 days = Accounts Receivable * 365/ $800,000
Accounts Receivable = $65,753.42
Days Payables Outstanding = Accounts Payable * 365 /
Purchases
45 days = Accounts Payable * 365 / $220,000
Accounts Payable = $27,123.29
Resources in Cash = Inventory + Accounts Receivable – Accounts
Payable
Resources in Cash = $71,917.81 + $65,753.42 - $27,123.29
Resources in Cash = $110,547.94
Answer to Requirement 3.
The company can reduce the amount needed in support of CCC by
increase Accounts Payable period.
Add Answer to:
A firm takes 30 days to collect its accounts receivables and 45 days to pay its...
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How long (in days) does it take the below firm to collect its receivables? Use 365 days for the year. Sales 910 COGS 742 Accounts Receivable 83 Inventory 118 Accounts Payable 103
Please I NEED all of them Cash conversion cycle American Products is concemed about managing cash...
Please
I NEED all of them
Cash conversion cycle American Products is concemed about managing cash efficiently. On the average, inventories have an age of 78 days, and accounts receivable are collected in 45 days. Accounts payable are paid approximately 34 days after they arise. The firm has annual sales of about $30 million. Cost of goods sold are $19 milion, and purchases are $17 million. ome a. Calculate the firm's operating cycle. b. Calculate the firm's cash conversion cycle....
uiek ratio to exceed the current ratio? iy moou the current ratio? 15. Interpret a working...
uiek ratio to exceed the current ratio? iy moou the current ratio? 15. Interpret a working capital requirement of S0. PROBLEMS For the problems, CCC-cash conversion cycle, DSo days' sales outstanding, DIH ld, and DPO days' payable outstanding. 1.) Suppose that a firm has a 30-day DSO. Determine the firm's DIlH if the operating cycle is days' inventory a. 30 days b. 60 days c. 80 days 2. Suppose that a firm has a 50-day DIH and a 30-day DPO....
Annual sales $9,700,000 Cost of goods sold $7,275,000 Inventory $3,200,000 Accounts receivable $1,800,000 Accounts payable $2,400,000...
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P14-1 (similar to) Question Help fome Cash conversion cycle American Products is concerned about managing cash...
P14-1 (similar to) Question Help fome Cash conversion cycle American Products is concerned about managing cash efficiently. On the average, inventories have an age of 77 days, and accounts receivable are collected in 40 days. Accounts payable are paid approximately 32 days after they arise. The firm has annual sales of about $40 million Cost of goods sold are $18 million, and purchases are $14 million ents a. Calculate the firm's operating cycle b. Calculate the firm's cash conversion cycle...
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Maggie's Maple Treats average age of accounts receivable is 45 days, the average age of accounts payable is 40 days, and the average age of inventory is 69 days. Assuming a 365-day year, what is the length of its cash conversion cycle?
38. Inmoo Company's average age of accounts receivable is 45 days, the average age of accounts...
38. Inmoo Company's average age of accounts receivable is 45 days, the average age of accounts payable is 35 days, and the average age of inventory is 60 days. Assuming a 365-day year, what is the length of its cash conversion cycle? a. 63 days b. 65 days c. 70 days d. 75 days e. 78 days
American Products is concerned about managing cash efficiently. On the average, inventories have an age of...
American Products is concerned about managing cash efficiently. On the average, inventories have an age of 84 Days, and accounts receivable are collected in 46 days. Accounts payable are paid approximately 29 days after they aise. The firm has annual sales of about $34 million. Cost of goods sold are $18 million, and purchases are $14 million. a. Calculate the firm's operating cycle. b. Calculate the firm's cash conversion cycle. c. Calculate the amount of resources needed to support the...
8 Other things held constant, ifa fir tretches" e, delays paying) its accounts payable, this will lengthen its cash...
8 Other things held constant, ifa fir tretches" e, delays paying) its accounts payable, this will lengthen its cash comvesion cycle (CCC) a True h. Fale 9. Which of the following actions should Reece Windows take if it wants to tedluce its cash conversion cycle a. Start paying its bills sooner, which would reduce the average accounts payable but not affect sales b Take steps to reduce the DSO e. Sell common stock to retire longterm bonds d. Sell an...
Value options Inventory conversion period: 56.77 days 43.26 days 45.96 days 131.70 days Average collection period:...
Value options
Inventory conversion period:
56.77 days
43.26 days
45.96 days
131.70 days
Average collection period:
34.20 days
23.32 days
86.55 days
29.54 days
Payables deferral period:
62.57 days
49.53 days
54.75 days
127.00 days
Cash conversion cycle:
31.37 days
91.25 days
29.72 days
28.07 days
Then the multiple choices
1. Cash conversion cydle AaAa Consider the case of Green Melon Electronics Company: Green Melon Electronics Company is a mature firm that has a stable flow of business. The following...
Please
I NEED all of them
Cash conversion cycle American Products is concemed about managing cash efficiently. On the average, inventories have an age of 78 days, and accounts receivable are collected in 45 days. Accounts payable are paid approximately 34 days after they arise. The firm has annual sales of about $30 million. Cost of goods sold are $19 milion, and purchases are $17 million. ome a. Calculate the firm's operating cycle. b. Calculate the firm's cash conversion cycle....
uiek ratio to exceed the current ratio? iy moou the current ratio? 15. Interpret a working capital requirement of S0. PROBLEMS For the problems, CCC-cash conversion cycle, DSo days' sales outstanding, DIH ld, and DPO days' payable outstanding. 1.) Suppose that a firm has a 30-day DSO. Determine the firm's DIlH if the operating cycle is days' inventory a. 30 days b. 60 days c. 80 days 2. Suppose that a firm has a 50-day DIH and a 30-day DPO....
Annual sales $9,700,000 Cost of goods sold $7,275,000 Inventory $3,200,000 Accounts receivable $1,800,000 Accounts payable $2,400,000 Blue Ostrich's CFO is interested in determining the length of time funds are tied up in working capital. Use the information in the preceding table to complete the following table. (Note: Use 365 days as the length of a year in all calculations, and round all values to two decimal places.) Value Inventory conversion period Average collection period Payables deferral period Cash conversion cycle...
P14-1 (similar to) Question Help fome Cash conversion cycle American Products is concerned about managing cash efficiently. On the average, inventories have an age of 77 days, and accounts receivable are collected in 40 days. Accounts payable are paid approximately 32 days after they arise. The firm has annual sales of about $40 million Cost of goods sold are $18 million, and purchases are $14 million ents a. Calculate the firm's operating cycle b. Calculate the firm's cash conversion cycle...
38. Inmoo Company's average age of accounts receivable is 45 days, the average age of accounts payable is 35 days, and the average age of inventory is 60 days. Assuming a 365-day year, what is the length of its cash conversion cycle? a. 63 days b. 65 days c. 70 days d. 75 days e. 78 days
8 Other things held constant, ifa fir tretches" e, delays paying) its accounts payable, this will lengthen its cash comvesion cycle (CCC) a True h. Fale 9. Which of the following actions should Reece Windows take if it wants to tedluce its cash conversion cycle a. Start paying its bills sooner, which would reduce the average accounts payable but not affect sales b Take steps to reduce the DSO e. Sell common stock to retire longterm bonds d. Sell an...
Value options
Inventory conversion period:
56.77 days
43.26 days
45.96 days
131.70 days
Average collection period:
34.20 days
23.32 days
86.55 days
29.54 days
Payables deferral period:
62.57 days
49.53 days
54.75 days
127.00 days
Cash conversion cycle:
31.37 days
91.25 days
29.72 days
28.07 days
Then the multiple choices
1. Cash conversion cydle AaAa Consider the case of Green Melon Electronics Company: Green Melon Electronics Company is a mature firm that has a stable flow of business. The following...
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