Your consulting firm was recentlyhired to improve the performance ofRP Inc, which is highly profitable buthas been experiencing cashshortages due to its high growthrate. As one part of your analysis.you want to determine the firm'scash conversion cycle. Using thefollowing information and a 365-dayyear, what is the firm's present cashconversion cycle?Average inventoryAnnual salesAnnual cost of goods seldAverage accounts receivableAverage accunts payableP5.000P00.000PH0,000P0,000F5000140.6 days120.6 days133.6 days148.0 daysO 126.9 days

Receivable Days: Receivable Days Average Accounts Receivable / Sales = Receivable Days…

Answered: Your consulting firm was recently hired…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

You must type in both the answer and all of your work to receive credit. Use the financial statements and additional data provided by management to calculate the firm's Free Cash Flow for the projected year. • Tax rate = 25% • Plans for the projected year will require $500 of new machinery and equipment • Firm expects next year's dividend to be $260 Acme Products, Inc. Balance Sheets ASSETS Cash Receivables Inventory Property, plant & equipment Total assets LIABILITIES & EQUITY Accounts payables Accrued expenses Long-term debt Common stock Paid-in Capital Retained earnings Total liabilities and equity current yr 400 600 900 2,200 4,100 500 400 1,400 600 200 1,000 4,100 projected yr 500 750 1,125 2,750 Acme Products, Inc. Income Statement Operating expenses 5,125 Depreciation 5,125 Sales (all credit) Cost of Goods Sold Gross Profit Operating income Interest expense 625 Taxable income 500 Taxes (25%) 1,750 Net income 750 250 1,250 projected yr 7,000 4,000 3,000 1,400 400 1,200 100 1,100…
You are building a free cash flow to the firm model. You expect sales to grow from $1.6 billion for the year that just ended to $1.84 billion five years from now. Assume that the company will not become any more or less efficient in the future. Assume that the company will grow at a constant rate for 5 years, and then at a constant rate of 2.334672% for year 5 and onward after that. Use the following information to calculate the value of the equity on a per-share basis. a. Assume that the company currently has $528 million of net PPSE. b. The company currently has $176 million of net working capital. c. The company has operating margins of 10 percent and has an effective tax rate of 30 percent. d. The company has a weighted average cost of capital of 9 percent. This is based on a capital structure of two-thirds equity and one-third debt. e. The firm has 2 million shares outstanding. Do not round intermediate calculations. Round your answer to the nearest cent. S
ARCI Instruments manufactures a ventilation controller designed for monitoring and controlling carbon monoxide in parking garages, boiler rooms, tunnels, etc. The net cash flow associated with one phase of the operation is shown on the next page. (a) How many possible rate of returnvalues are there for this cash flow series? (b) Find all the rate of return values between 0 and 100% using tabulated factors and a spreadsheet.
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 365-day year,(a) what is your estimate of the firm’s current cash conversion cycle? Current inventory = $241,000.00 • Annual sales = $1,200,000.00 • Accounts receivable = $300,000.00 • Accounts payable = $245,000.00 • Total annual purchases = $600,000.00 • Purchases credit terms: net 30 days. • Receivables credit terms: net 50 days.
A new advertising campaign by a company that manufactures products that rely on biometrics, surveillance, and satellite technologies resulted in the cash flows shown (in $1000 units). Develop one spreadsheet that displays the following: external rate of return using both the ROIC method with ir = 30% per year, and the modified ROR approach with ir = 30% and ib = 10% per year; and the unique or multiple internal rate of return value(s) indicated by the two multiple-root sign tests.
The financial manager of a firm wants to determine the amount of cash outlays to be spent for the next period. He asked the help of the accountant and the latter provided a cash budget for the next year. According to the computations, the company would be incurring cash expenses of P6,612,500 per month. The financial manager has estimated a cost of P40 per transaction in case non-cash asset is converted to cash. The firm’s opportunity cost ratio is 12%. The optimum cash balance is? The average cash balance is? the number of conversion made during the year is? The total cash cost is?
If the appropriate interest rate to use when evaluating potential project for the firm is 10%, what is the present value of these cash flows?
please help me
4. In time value of money, we use five categories of information, viz., present value, future value, discount rate, number of compounding periods and interim payments. In particular, the choice of the right discount rates is a challenge as it represents a combination of risk factors, such as business; inflation; environmental; social and political risks. Your company is planning an investment project in commercial forestry. Prepare a briefing note appraising the top management on the potential risks in evaluating a project in commercial forestry and how will this impact the project decisions.
Peta is considering purchasing a new machine that will increase profits over the next ten years. What is the unique insight that is gained from each of the following analyses: 1. Accounting Rate of Return 2. Payback Period 3. Net Present Value
As an operations management consultant, you have been asked to evaluate a furniture manufacturer's cash-to-cash conversion cycle under the following assumptions: sales of $24.5 million, cost of goods sold of $23.5 million, 50 operating weeks a year, total average on hand inventory of $2,400,000, accounts receivable equal to $2,455,000, and accounts payable of $3,775,000. What is the cash-to-cash conversion cycle in weeks? Do not round intermediate calculations. Round your answer to one decimal place. week(s) What recommendations can you make to improve performance? -Select- v inventory weeks of supply and -Select- v accounts receivable weeks of supply or v accounts payable weeks of supply are ways to improve overall firm performance. -Select-
Solve it correctly please. I

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS