Canadian Bacon Inc. financial statements are presented in the table below.
Based on the information in the table, and using a 365-day year, calculate cash conversion cycle
Round the answers to two decimal places
Balance Sheet December 31, 2012
Cash and marketable securities | $198,000 | Accounts payable | $288,000 |
Accounts receivable | $469,000 | Notes payable | $65,000 |
Inventories | $577,000 | Accrued expenses | $84,000 |
Prepaid expenses | $15,700 | Total current liabilities | $437,000 |
Total current assets | $1,259,700 | Long-term debt | $237,000 |
Gross fixed assets | $1,954,000 | Par value and paid-in-capital | $199,000 |
Less: accumulated depreciation | $476,000 | Retained Earnings | $1,864,700 |
Net fixed assets | $1,478,000 | Common Equity | 2,063,700 |
Total assets | $2,737,700 | Total liabilities and owner’s equity | $2,737,700 |
Income Statement, Year of 2012
Net sales (all credit) | $7,546,600.00 |
Less: Cost of goods sold | $6,112,746.00 |
Selling and administrative expenses | $349,000.00 |
Depreciation expense | $145,000.00 |
EBIT | $939,854.00 |
Interest expense | $49,500.00 |
Earnings before taxes | $890,354.00 |
Income taxes | $356,141.60 |
Net income | $534,212.40 |
purchases = CoGS-payables = 6112746-288000 =
5824746 |
Cash cycle = 365 * avg receivables/net credit sales + 365 * avg inventory/COGS- 365*avg payables/purchases
=365*469000/7546600+365*577000/6112746-365*288000/5824746 = 39.09 days
Canadian Bacon Inc. financial statements are presented in the table below. Based on the information in...
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