Computation of working capital cyclethe garcia industries

Assignment Help Financial Accounting
Reference no: EM13356686

Computation of working capital cycle.

The Garcia Industries balance sheet and income statement for the year ended 2006 are as follows:
Balance Sheet (in Millions of Dollars)

Assets

Liabilities and Stockholder's Equity

Cash

$6.0

Accounts Payable

$10.0

Accounts receivable

14.0

Salaries, benefits, and payroll taxes payable

2.0

Inventories*

12.0

Other current liabilities

10.0

Fixed Assets, net

40.0

Long-term debt

12.0

 

 

Stockholders' equity

38.0

 

72.00

 

72.00

*The average inventory over the past 2 years also equals 12 million.
Income Statement (in Millions of Dollars)

Net Sales

$100.0

Cost of Sales

60.0

Selling, general and administrative expenses

20.0

Other expenses

15.0

Net Income

5.0

a. Determine the length of the inventory conversion period.
b. Determine the length of the receivables conversion period.
c. Determine the length of the operating cycle.
d. Determine the length of the payables deferral period.
e. Determine the length of the cash conversion cycle.
f. What is the meaning of the number you calculated in (e)?

Reference no: EM13356686

Questions Cloud

Calculating additional finance requirements amp average : calculating additional finance requirements amp average collection period.baldwin products co. anticipates reaching a
The question is regarding working capital management : the question is regarding working capital management involving computation of inventory needed.abc corp. is required by
Determining a companys annual financing cost of this : determining a companys annual financing cost of this commercial paper financingwalters manufacturing company has been
Computation of cash conversion cycle from income statement : computation of cash conversion cycle from income statement and balance sheet.the hopewell pharmaceutical companys
Computation of working capital cyclethe garcia industries : computation of working capital cycle.the garcia industries balance sheet and income statement for the year ended 2006
Recognition of contingent liability in financial : recognition of contingent liability in financial statement.your company has been sued. the plaintiffs accounting expert
Difference between gaap used in financial statements and : difference between gaap used in financial statements and government regulation.generally accepted accounting principles
Computation of accounting rate of return and : computation of accounting rate of return and depreciation.accounting rate of i9turn payback and npv busy beaver corp.
Multiple choice questions related to valuation of real : multiple choice questions related to valuation of real estate property.1.nbspwhat concept is illustrated if the

Reviews

Write a Review

Financial Accounting Questions & Answers

  Create an income statement using full costing

The following information relates to Vice Versa Ventures for calendar year 20XX, the company’s first year of operations: Create an income statement using full costing.

  Evaluate effect on classification and carrying value

Evaluate the effect on classification, carrying value, and earnings for each of the given situations. Discuss whether U.S. GAAP under SFAS No. 115 or the needs of IAS.

  Preparation of cash flow statementuse the following

preparation of cash flow statement.use the following information to prepare a cash flow statement for oju company for

  Actual costs based on actual usage

Variable costs are allocated based on the budgeted rate per copy times the department's actual usage. Which of the following is not an advantage of this allocation scheme over allocating actual costs based on actual usage?

  Accounting treatment for errors and corrections

Accounting treatment for errors and corrections - Income Statement and the stockholder's equity section of the Balance Sheet using the symbol (O/S) for overstated, (U/S) for understated, and (N/E) for no effect.

  Sherlys shipping had sales last year of 10000 the cosr of

sherlys shipping had sales last year of 10000. the cosr of goods sold was 6500 general and administrative expenses were

  Should kimball make or buy the parts

The required volume of output to produce the parts will not require any incremental fixed overhead. Incremental variable overhead cost is $2.00 per unit. Should Kimball make or buy the parts?

  Show the classify costs associated with manufacturing firms

Classify Costs associated with manufacturing firms, merchandising firms or service firms

  Purpose a pension worksheet for the pension plan

Purpose a pension worksheet for the pension plan for 2013 and 2014.

  Outline findings of the various courts of appeal

Outline the findings of the various courts of appeal and discuss the severity of the penalties awarded to the management of James Hardie.

  What is best way for this business to ensure the sales data

His employees can be found on many of the major intersections hawking his wares out of the backs of station wagons and pickup trucks. What is best way for this business to ensure that sales data entry is efficient and accurate?

  Evaluate the unit cost of product x

If overhead is allocated on the basis of direct labor hours, compute the unit cost of Product X - Evaluate the unit cost of Product X under the ABC system.  Comment briefly.

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