Working capital cycle for a trade, Financial Econometrics

Assignment Help:

Working capital cycle for a trade

Inventories days (time inventories are

held before being sold)

 

+

 

Trade receivables days (how long the

credit customers take to pay)

 

-

 

 

Trade payables days (how long the

company takes to pay its suppliers)

 

=

 

 

Working capital cycle (in days)

(Inventories/ cost of sales)x 365 days

 

 

+

 

(Trade receivables / credit sales) x 365 days

 

 

-

 

 

(Trade payables / purchases)x 365 days

 

 

=

 

 

Working capital cycle (in days)

Please note that for "trade payable days" calculation, if information about credit purchases isn't known then cost of sales is used instead.


Related Discussions:- Working capital cycle for a trade

Calculate invest in the risk-free asset, Question You want your portfol...

Question You want your portfolio beta to be 1.20. Currently, your portfolio consists of $100 invested in stock A with a beta of 1.4 and $300 in stock B with a beta of .6. You h

Expected Experience Ratio, How do Insurance companies calculate the Expecte...

How do Insurance companies calculate the Expected Experience Ratio

What effective annual rate of return did you earn, You purchased your house...

You purchased your house 5 years ago for $110,000 and based on recent appraisals it can be sold today for $141,000. What effective annual rate of return did you earn?

Cash flow forecast, Introduction - Overview of the business idea. A clear o...

Introduction - Overview of the business idea. A clear outline of what you intend to present and why you are presenting it in your chosen method or style Business Plan A clear

Is the investment attractive, During and economic downturn, we can acquire ...

During and economic downturn, we can acquire another company by purchasing its stock for $6 billion. The company is earning $700 million a year, which is available for dividends, a

the risky efficient frontier, Create a new µσ-plane graph displaying the r...

Create a new µσ-plane graph displaying the risk-less cash fund, tangency portfolio, Pythagoras's new optimal portfolio and the Capital Market Line relative to the risky efficient f

Show the symptoms of overtrading, Q. Show the Symptoms of overtrading? ...

Q. Show the Symptoms of overtrading? Symptoms of overtrading • Fast sales growth. • Increasing trade payables. • Increasing trade receivables. • Fall in cash bal

What are the main causes of inflation, Question 1: "When inflation twic...

Question 1: "When inflation twice surged to double digit level in the mid and late seventies, American named it public enemy number one." a) What are the main causes of in

investors could expect to earn 8 percent, A new capital investment that wi...

A new capital investment that will cost $2.5 million and will generate perpetual net cash flows of $400,000 a year. Investors could expect to earn 8 percent elsewhere while taking

Conservative policy - working capital policy, Q. Conservative policy - work...

Q. Conservative policy - working capital policy? All the non-current assets,permanent assets and some of the temporary current assets are financed bylong-term finance. £90m lon

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd