Problem 12.20 Premier Corp. has net sales of $1,000,000, and cost of goods sold equal to...
Problem 12.20
Premier Corp. has net sales of $1,000,000, and cost of goods sold equal to 76 percent of net sales. Assume all sales are credit sales. If the firm’s accounts receivable total $127,000 and its operating cycle is 79.0 days, how much inventory does the firm have? (Round answer to nearest dollar, e.g. 5,275.)
| The firm’s inventory is $.............. |
Homework Answers
account receivable days are
=365/(1000000/127000)
=46.355 days
inventory days=Operating cycle-account receivable days
=79-46.355
=32.645 days
how much inventory does the firm have
=(32.645/365)*(1000000*76%)
=67973
the above is answer..
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Problem 12.20
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