Please given correct answer general accounting ABC, Inc. has been experiencing cash shortages due to its high growthrate. Using the following information, what is the firm's Cash ConversionCycle?Average inventory = $75,000Annual sales = $600,000=Annual cost of goods sold - $360,000=Average accounts receivable - $160,000Average accounts payable = $25,000

Step 1: Define Cash CycleThe cash conversion cycle determines the time length a company takes to…

Answered: ABC, Inc. has been experiencing cash…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Your boss asks you to compute your company's cash conversion cycle. Looking at the financial statements, you see that the average inventory for the year was $24,800, accounts receivable averaged $18,700, and accounts payable averaged $16,100. You also see that the company had sales of $138,000 and that cost of goods sold was $110,400. Calculate firm's cash conversion cycle. (Use 365 days for calculation. Round intermediate calculations and final answer to 1 decimal place, e.g. 15.1.)
Your boss asks you to compute the company's cash conversion cycle. Looking at the financial statements, you see that the average inventory for the year was $126,300, accounts receivable were $97,900, and accounts payable were at $115,100. You also see that the company had sales of $324,000 and that cost of goods sold was $282,000. What is your firm's cash conversion cycle? Round to the nearest day.
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Your consulting firm was recently hired to improve the performance of ABC Inc, which is highly profitable but has been experiencing cash shortages due to its high growth rate. As one part of your analysis, you want to analyze the firm's cash cycle. Using the following information and a 365-day year, what is the firm’s operating cycle? Average inventory = $75,000 Annual sales = $875,000 Annual cost of goods sold = $525,000 Average accounts receivable = $160,000 Average accounts payable = $25,000
"You have recently been hired to improve the performance of Multiplex Corporation which has been experiencing a severe cash shortage. As one part of your analysis, you want to determine the firm's cash conversion cycle. Using the following information and a 360-day year, what is your estimate of the firm's current cash conversion cycle? Current inventory = $120,000. Annual sales = $600,000. Accounts receivable = $160,000. Accounts payable = $35,000. Total annual purchases = $360,000. Purchases credit terms: net 30 days. Receivables credit terms: net 50 days. " Group of answer choices 195 days 177 days 171 days 201 days 181 days
Aztec Products wishes to evaluate its cash conversion cycle (CCC). Research by one of the firm’s financial analysts indicates that on average the firm holds items in inventory for 65 days, pays its suppliers 35 days after purchase, and collects its receivables after 55 days. The firm’s annual sales (all on credit) are about R2.1 billion, its cost of goods sold represent about 67 percent of sales, and purchases represent about 40 percent of cost of goods sold. Assume a 365-day year. What is Aztec Products’ cash conversion (CCC)? If Aztec could shorten its CCC by 5 days, would it be best to reduce the inventory holding period, reduce the receivable collection period, or extend the accounts payable period? Why? How should the firm manage its inventory, accounts receivable, and accounts payable in order to reduce the length of its cash conversion cycle?
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Dewey Corporation has the following data, in thousands. Assuming a 365-day year, what it the firm’s cash conversion cycle? You do not have previous year's numbers so you cannot calculate average numbers. Just use data from this year Annual sales $45,000 Annual cost of goods sold $31,500 Inventory $4,000 Accounts receivable $2,000 Accounts payable $2,400
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Shulman Inc. has the following data, in thousands. Assuming a 365-day year, what is the firm's cash conversion cycle? Annual sales = $45,000 Annual cost of goods sold = $30,000 Inventory = $4,500 Accounts receivable = $1,800 Accounts payable = $2,500 a. 28 days b. 43 days c. 39 days d. 35 days e. 32 days

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