The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Net sales Cost of sales Liabilities and Equity Earnings before taxes Taxes Earnings after taxes (net income) Accounts payable*** Accrued liabilities Selling, general, and administrative expenses Other expenses Total expenses (salaries and benefits) Other current liabilities **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Total current liabilities Long-term debt and other liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and equity Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days
The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Net sales Cost of sales Liabilities and Equity Earnings before taxes Taxes Earnings after taxes (net income) Accounts payable*** Accrued liabilities Selling, general, and administrative expenses Other expenses Total expenses (salaries and benefits) Other current liabilities **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Total current liabilities Long-term debt and other liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and equity Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days
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
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Transcribed Image Text:The Butler-Huron Company's balance sheet and income statement for last year are as follows:
Balance Sheet (in Millions of Dollars)
Assets
Cash and marketable securities
Accounts receivable*
Inventories**
Other current assets
Total current assets
Plant and equipment (net)
Other assets
Total assets
$82
820
1,507
22
$2,431
3,967
6,460
$6,460
Liabilities and Equity
Accounts payable******
Accrued liabilities
(salaries and benefits)
Other current liabilities
Total current liabilities
Long-term debt and other
liabilities
Earnings before taxes
Taxes
Earnings after taxes (net income)
Common stock
Retained earnings
Net sales
Cost of sales
Selling, general, and administrative expenses
Other expenses
Total expenses
Total stockholders' equity
Total liabilities and equity
**Assume that average inventory over the year was the same as ending inventory.
***Assume that average accounts payable are the same as ending accounts payable.
Income Statement (in Millions of Dollars)
*Assume that all sales are credit sales and that average accounts receivable are the same
as ending accounts receivable.
$13,599
10,512
1,828
701
$13,041
558
223
$335
$869
696
296
$1,861
2,719
159
1,721
$1,880
$6,460
Assume that there are 365 days per year.
a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place.
days
b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place.
days
c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place.
days
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