Cash conversion cycle-cash freed up-pre-tax profit
Course:- Managerial Accounting
Reference No.:- EM1349699

Assignment Help
Assignment Help >> Managerial Accounting

Primrose Corp has $15 million of sales, $2 million of inventories, $3 million of receivables, and $1 million of payables. Its cost cost of goods sold is 80% of sales, and it finances working capital with bank loans at an 8% rate. What is Primrose's cash conversion cycle (CCC)? If Primrose could lower its inventories and receivables by 10% each and increase its payables by 10%, all without affecting either sales or cost of goods sold, what would the new CCC be, how much cash would be freed up, and how would that affect pre-tax profits?

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Managerial Accounting) Materials
Find the contribution margin per haircut. Assume that the barbers compensation is a fixed cost and what will be the operating income if 20,000 haircuts are performed?
Discuss the way in which AGL has demonstrated its social and environmental accountability in the last two years and discuss the stance and initiatives of the Australian accoun
Identify the stakeholders potentially affected by what Daniels decides to do. How might each stakeholder be affected by Daniels's action and decision? Use ethical reasoning
Identify the relevance of the data given in the exercise to the decision about what to do with the obsolete parts. Current sales value for unmodified parts Sales value for m
The company incurred actual total manufacturing overhead costs of $249,000 and 10,800 total direct labor-hours during the period. Required: Determine the amount of manufacturi
1. Prepare a schedule of expected cash collections for April, May, and June, and for the three months in total.2. Prepare a cash budget, by month and in total, for the three-m
Develop quantitative skills necessary to read, interpret and perform the calculations for the accounting reports involved in cost control and profit planning - prepare and p
What would be the balances, at the end of 2014, 2015, and 2016, in the center's (1) permanently restricted endowment fund and (2) related temporarily restricted fund? Also