Cash conversion cycleChristie Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Christie's 2012 sales (all on credit) were$287,000; its cost of goods sold is 80% of sales; and it earned a net profit of 8%, or $22,960. It tumed over its inventory 5 times during the year, and its DSO was 39 days. The firm had fixedassets totaling $40,000. Christie's payables deferral period is 50 days. Assume 365 days in year for your calculations.a. Calculate Christie's cash conversion cyde. Round your answer to two decimal places.daysb. Assuming Christie holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. Round your answer to two decimal places.Total assetsROAt. Suppose Christle's managers belleve that the inventory turnover can be raised to 8.4 times. What would Christie's cash conversion cyde, total assets turnover, and ROA have been iF theInventory turnover had been 8.4 for 20127Cash conversion cycledaysTotal assetsROA

Cash conversion cycle is representing that how long it takes for an organization to convert it's…

Answered: Cash conversion cycle Christie…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Asset Management Ratios Corn Products, Corp. ended the year 2008 with an average collection period of 30 days. The firm's credit sales for 2008 were $10.9 million. What is the year-end 2008 balance in accounts receivable for Corn Products? (Consider a 365 days a year.)
The following information is an extract of the statement of profit or loss of Palladium Ltd for the current financial year: The average accounts receivable collection period is 45 days. The average payment supplier period is 50 days and the cash conversion cycle has been calculated as 55 days. REQUIRED: Annual sales (20% cash) R625 000 Cost of Sales R125 000 Purchases (50% on credit) R200 000 Calculate the total average investment in the cash conversion cycle (CCC) for Palladium Ltd.Assume that there are 365 days in a year.Round to the nearest Rand.
Supply the missing components of the Statement of Financial Position and Sales information using the following financial data:Debt ratio: 50%Current ratio: 1.8×Total assets turnover: 1.5×Days sales outstanding: 36.5 days*Gross profit margin on sales: (Sales − Cost of goods sold)/Sales = 25%Inventory turnover ratio: 5×*Calculation is based on a 365-day year.Statement of Financial Position(in Thousands)Cash ________Accounts payable_________Accounts receivable ________Long-term debt PhP120,000Inventories ________Common stock_________Fixed assets ________Retained earnings 195,000Total assets PhP600,000Total liabilities and equity _________Sales _______Cost of goods sold _________
The Nyameye Manufacturing Company increased its merchandise inventory by GH¢17,000 over the year. The company also granted its customers more liberal credit terms which increased the accounts receivable by GH¢37,500. Sales were GH¢975,000, and the accounts payable decreased by GH¢27,500. The gross profit on sales is 45%. Marketing and administrative expenses were GH¢145,000; this included depreciation expense of GH¢4,000. What were the cash disbursements for the year?
Zane Corporation has an inventory conversion period of 76 days, an average collection period of 35 days, and a payables deferral period of 20 days. Assume 365 days in year for your calculations. What is the length of the cash conversion cycle? Round your answer to two decimal places.days If Zane's annual sales are $2,030,230 and all sales are on credit, what is the investment in accounts receivable? Do not round intermediate calculations. Round your answer to the nearest cent.$ How many times per year does Zane turn over its inventory? Assume that the cost of goods sold is 75% of sales. Use sales in the numerator to calculate the turnover ratio. Do not round intermediate calculations. Round your answer to two decimal places.x
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Please Solve This Question International Industries sells on terms of 3/10, net 50. Gross sales last year were 5,662,500 and accounts receivable averaged 547,500. Half of International’s customers paid on the 15th day and took discounts. What are the nominal and effective costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based on a 360-day year, then calculate average receivables of discount customers and then find the DSO for the non-discount customers.
Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $285000; its cost of goods sold is 80% of sales; and it earned a net profit of 6%, or $17100. It turned over its inventory 6 times during the year, and its DSO was 35 days. The firm had fixed assets totaling $37000. Chastain's payables deferral period is 40 days. Assume 365 days in year for your calculations. A. Calculate Chastain's cash conversion cycle. Round your answer to two decimal places. Do not round intermediate calculations. B.Assuming Chastain holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. Round your answers to two decimal places. Do not round intermediate calculations. C.Suppose Chastain's managers believe that the inventory turnover can be raised to 8.9 times. What would Chastain's cash conversion cycle, total assets…
Sisyphus Inc. records total sales of $657,500 in the current period, with a cost of goods sold of $389,000 . Sisyphus expects 4% of sales to be returned. How much in net sales will Sisyphus recognize for the current period? Group of answer choices $373,400 $268,500 $631,200 $657,500 $257,760 The Sisyphus Inc’s (SSY) Company’s annual statement of cash flows reported the following (in millions): Net cash from financing activities $63,864 Net cash from investing activities -62,512 Cash at the beginning of the year 13,152 Cash at the end of the year 18,948 What did SSY report for “Net cash from operating activities” during the year? Group of answer choices $71,220 million cash inflow None of the above $4,444 million cash outflow $4,444 million cash inflow $71,220 million cash outflow
What is the cash conversion cycle for ABC corporation using the following information: sales: 10,000,000 cost of goods:7, 500,000 accounts receivable: 1, 232, 877 inventory turnover ratio: 10 payable deferred period:40

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