EBK CORPORATE FINANCE
4th Edition
ISBN: 8220103164535
Author: DeMarzo
Publisher: PEARSON
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Textbook Question
Chapter 27, Problem 2P
Sailboats Etc. is a retail company specializing in sailboats and other sailing-related equipment. The following table contains financial
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Quarterly working capital levels for your firm for the next year are included in the following table. What are the
permanent working capital needs of your company? What are the temporary needs?
(000)
Cash
Accounts Receivable
Inventory.
Accounts Payable
1
$100
205
201
103
2
Quarter
$100
105
503
103
3
$100
100
901
103
aww
4
$100
603
48
98
What are the permanent working capital needs of your company?
The permanent working capital needs of your company are $. (Round to nearest dollar.)
You have been provided Income Statement and Financial Position Statement of Oman Cement Company SAOG for the year 2018 and 2019. You are required to evaluate the Working Capital position of this company for the year 2018 and 2019 based on following calculations:
Liquidity position of the company (current ratio and quick ratio). What is your view about status of liquidity position of Oman Cement Company?
Cash Operating Cycle in a tabular form (as shown in ppt slide number 10 of working capital management) and present Cash Operating Cycle in a diagram for both years separately (as shown in class ppt slide number 9 of working capital management). ?
Based on the above calculation, give your overall view on working capital situation of Oman Cement Company between the year 2018 and 2019. What are your suggestions to Oman Cement Company for strengthening Working Capital Management?
Discuss…
Kate is considering expanding and bringing in several employees. To do this she will need a larger facility and to purchase more equipment. Which means additional financing. Answer this: look at the financial statements as if you were a banker considering her for a loan comment on your findings and use calculations to support your answer.
Chapter 27 Solutions
EBK CORPORATE FINANCE
Ch. 27.1 - Prob. 1CCCh. 27.1 - What is the effect of seasonalities on short-term...Ch. 27.2 - Prob. 1CCCh. 27.2 - What is the difference between temporary and...Ch. 27.3 - Prob. 1CCCh. 27.3 - Describe common loan stipulations and fees.Ch. 27.4 - What is commercial paper?Ch. 27.4 - How is interest paid on commercial paper?Ch. 27.5 - Prob. 1CCCh. 27.5 - What is the difference between a floating lien and...
Ch. 27 - Prob. 1PCh. 27 - Sailboats Etc. is a retail company specializing in...Ch. 27 - What is the difference between permanent working...Ch. 27 - Quarterly working capital levels for your firm for...Ch. 27 - Prob. 5PCh. 27 - Prob. 6PCh. 27 - Prob. 7PCh. 27 - Prob. 8PCh. 27 - Which of the following one-year 1000 bank loans...Ch. 27 - The Needy Corporation borrowed 10,000 from Bank...Ch. 27 - Prob. 11PCh. 27 - Prob. 12PCh. 27 - Prob. 13PCh. 27 - The Signet Corporation has issued four-month...Ch. 27 - Prob. 15PCh. 27 - Prob. 16PCh. 27 - Prob. 17PCh. 27 - Prob. 18P
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- The following historical information is from Assisi Community Markets. Calculate the working capital and current ratio for each year. What observations do you make, and what actions might the owner consider taking?arrow_forwardKoch Engineering plc has produced the following information for its most recent financial year: (Click here to view the financial data.) Following a review of the working capital investment of the business, it was decided that liquidity could be improved if the following changes were made: 1. An decrease in the average settlement period for trade receivables to 35 days. 2. An increase in the average settlement period for trade payables to 50 days. 3. A decrease in the average inventories turnover period to 55 days. Calculate the extra cash that the business should generate by implementing each of the proposed changes. (Enter the answes in £m, round to one decimal place.) ... Trade receivables = £ m Trade payables = £m Inventories = £ marrow_forwardYou have been provided Income Statement and Financial Position Statement of Oman Cement Company SAOG for the year 2018 and 2019. 1. Discuss some of the factors that could impact the working capital management of Oman Cement Company SAOG?arrow_forward
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