Analyzing days sales outstanding and the aging schedule

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Reference no: EM132769620

Problem 1: The ____________________is the average length of time required to convert materials into finished goods and then sell those goods.

a.payables deferral period
b.receivables collection period
c.cash conversion period
d.inventory conversion period

Problem 2: Find the NPV for the following Capital Budgeting project.

year 0 $-1000
Year 1 $500
Year 2 $400
Year 3 $300
Year 4 $200
Year 5 $100
Cost of capital : 10

a.-239.21
b.239.21
c.-2,392.1
d.2,392.1

Problem 3: Analyzing days sales outstanding (DSO) and the aging schedule are two common methods for monitoring receivables. However, they can provide erroneous signals to credit managers when

a. Customer's payments patterns are changing
b. Sales fluctuate seasonally
c. Some customers take the discount and others do not
d. Sales are relatively constant, either seasonally or cyclically
e. None of the above

Reference no: EM132769620

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