## Answers

Q12

DIO | 365*Average Inventory/Cost of goods sold | Average Cost of Goods sold | 360000 | ||||||||

76.04167 | Average inventory | 75000 | |||||||||

Annual Sales | 600000 | ||||||||||

Average Accounts receivables | 160000 | ||||||||||

DSO | 365*average accounts receivables/credit sales | Average accounts payables | 25000 | ||||||||

97.33333 | |||||||||||

DPO | 365*average payables/cost of goods sold | ||||||||||

25.34722 | |||||||||||

Cash conversion Cycle=DIO+DSO-DPO | |||||||||||

148.0278 | |||||||||||

Answer is E |

Q13

BEFORE | AFTER | |||||||||||

Average Cost of Goods sold | 43124750 | Average Cost of Goods sold | 43124750 | |||||||||

Average inventory | 15012000 | Average inventory | 13066000 | |||||||||

Annual Sales | 50735000 | Annual Sales | 50735000 | |||||||||

Average Accounts receivables | 10008000 | Average Accounts receivables | 8062000 | |||||||||

Average accounts payables | Average accounts payables | |||||||||||

DIO | 365*Average Inventory/Cost of goods sold | |||||||||||

127.0588 | 110.5882 | |||||||||||

DSO | 365*average accounts receivables/credit sales | |||||||||||

72 | 58 | |||||||||||

DPO | 365*average payables/cost of goods sold | |||||||||||

30 | 40 | |||||||||||

Cash conversion Cycle=DIO+DSO-DPO | ||||||||||||

169.0588 | 128.5882 | 40.47059 | Answer is E |

Q14

Answer is b.False |

If the firm changes the credit terms from 2/10 net 30 to 3/10 net 30. The number of credit days remains at 30 days. Discount percent is increased to 3% from 2% to match the competitors. |

There are 2 methods for accounting the discounts. One is Gross and another is net methods. |

In Net method, receivables are recorded at sale price - discount even if customer makes use of the discount or does not. If customer does not make use of the discount, a interest revenue is recognized (difference between face value and discounted value) |

In gross method, receivables are recorded at face value |

In both the methods, receivables will remain constant and not change. |

Q15

Answer is b.
| ||

Year 1 (in Million) | Year 2 (in Million) | |

Sales | 5 | 5.5 |

Account receivables (90% credit) | 4.5 | 4.95 |

This clearly shows account receivables will also grow with increase in sales. | ||

#### Similar Solved Questions

1 answer

##### 22. A. B. Which of the following does not usually show a problem during meiosis? translocation...

22. A. B. Which of the following does not usually show a problem during meiosis? translocation heterozygote translocation homozygote paracentric inversion heterozygote pericentric inversion heterozygote...

1 answer

##### Explain the dynamics around the natural rate of unemployment.

Explain the dynamics around the natural rate of unemployment....

1 answer

##### (25). 3. Find ilt) 61 422 21 to ses Zov ately T**

(25). 3. Find ilt) 61 422 21 to ses Zov ately T**...

1 answer

##### The force applied against an object moving horizontally on a linear path is described by #F(x)=x^2+ x-1 #. By how much does the object's kinetic energy change as the object moves from # x in [ 1, 2 ]#?

The force applied against an object moving horizontally on a linear path is described by #F(x)=x^2+ x-1 #. By how much does the object's kinetic energy change as the object moves from # x in [ 1, 2 ]#?...

1 answer

##### Wade Company estimates that it will produce 6,000 units of product IOA during the current month....

Wade Company estimates that it will produce 6,000 units of product IOA during the current month. Budgeted variable manufacturing costs per unit are direct materials $5, direct labor $11, and overhead $17. Monthly budgeted fixed manufacturing overhead costs are $7,500 for depreciation and $3,500 for ...

1 answer

##### An expensive watch is powered by a 3-volt lithium battery expected to last five years. Suppose...

An expensive watch is powered by a 3-volt lithium battery expected to last five years. Suppose the life of the battery has a standard deviation of 0.7 year and is normally distributed. a. Determine the probability that the watch's battery will last longer than 5.2 years. b. Calculate the probabi...

1 answer

##### Solve the following system of equations. 2x+4y = 8 3x + 4y = 16 x =...

Solve the following system of equations. 2x+4y = 8 3x + 4y = 16 x = 0 Olo X y = -1...

1 answer

##### 1. If a person pushed a door with a force of 25 N, and the moment...

1. If a person pushed a door with a force of 25 N, and the moment arm was 1m, how much torque is produced? ______Nm 2. During a softball pitch, the pitcher's arm goes through 120 degrees of angular displacement over 0.25 seconds, What is the average angular velocity? _____ degree/s...

1 answer

##### Complete the income statement. Bug-Off Exterminators provides pest control services and sells extermination products manufactured by...

Complete the income statement. Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. Following is the company's unadjusted trial balance as of December 31, 2019. December 31, 2019 Unadjusted Trial Balance $ 17,000 4,000 $ 828 11,70...

1 answer

##### Describe a time when you witnessed or experienced cultural incompetence in the delivery of health care....

Describe a time when you witnessed or experienced cultural incompetence in the delivery of health care. Knowing what you now know, discuss what you think could have been done to avoid that incident?...

1 answer

##### Question number 2.2.2) TRY. An Air Conditioner (Aircon) is made up of 2 pumps (A): 2...

Question number 2.2.2) TRY. An Air Conditioner (Aircon) is made up of 2 pumps (A): 2 motors (B); and 1 evaporator assembly (C). The evaporator assembly (C) is made up of 4 aluminium plates (D), 2 fans (E) and 2 copper tubing subassemblies (F). Each copper tubing subassembly (F) is made up of 2 brack...

1 answer

##### Hillside issues $1,900,000 of 5%, 15-year bonds dated January 1, 2019, that pay interest semiannually on...

Hillside issues $1,900,000 of 5%, 15-year bonds dated January 1, 2019, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $1,641,812. Required: 1. Prepare the January 1 journal entry to record the bonds' issuance. 2(a) For each semiannual period, comple...

1 answer

##### How do I figure out the var ?? [Prior Quarter] Var +/- Var % Budget Projection...

How do I figure out the var ?? [Prior Quarter] Var +/- Var % Budget Projection Next Q 64,685 901 100 0 59,685 901 0 0 5,000 0 0% 100 100% I 60,586 [Prior Quarter] 65,586 Budget Projection Next Q Var +/- Var %...

1 answer

##### 1. Use the forward-difference formulas and backward-difference formulas to determine each missing entry in the following...

1. Use the forward-difference formulas and backward-difference formulas to determine each missing entry in the following tables. 0.0 0.00000 0.2 0.74140 0.4 1.3718 xf(x) s(x) 0.3 1.9507 0.2 2.0421 -0.1 2.0601 MATH-321: INTRODUCTION TO NUMERICAL ANALYSIS 2·The data in Exercise 1 comes from fun...

1 answer

##### How would a healthcare administrator use validity, relatability, sensitivity, specificity and predictive values to deter...

How would a healthcare administrator use validity, relatability, sensitivity, specificity and predictive values to determine whether to use a new test tonscreen an entire population?...

1 answer

##### Home Decor Pty Ltd is considering investing in a new machine to assemble its new product...

Home Decor Pty Ltd is considering investing in a new machine to assemble its new product of high quality speakers. The machine is estimated to cost $124000 which can last for 5 years before it becomes unreliable and can be sold for scrap at $12,000. The project is estimated to bring in additional $4...

1 answer

##### Lanthanoid and actinoids are placed in separate rows at the bottom of the periodic table. What is the reason for this arrangement?

Lanthanoid and actinoids are placed in separate rows at the bottom of the periodic table. What is the reason for this arrangement?...