Reference no: EM132924246
Question - CompuTech's Income Statement for the year ended, December 31, 2021.
Sales Revenue
Gross Sales Revenue $360,000
Net Sales Revenue $360,000
Cost of Goods Sold
Raw Materials $132,000
Total Cost of Goods Sold $132,000
Gross Profit $228,000
Operating Expenses sales salaries $80,000
Advertising $3,000
Travel $2,000
Depreciation $38,000
Office lease $13,000
Admin Salaries $40,000
Total Operating Expenses $176,000
Operating Profit $52,000
Other Income & Expenses
Financial cost $10,000
Less Interest Charges
Income before Taxes $42,000
Income Taxes $22,000
Net Income $20,000
Required -
Q1: What is the company's expected Current Asset level? What is the company's Net Property & Plant level?
Q2: Looking at your 2021 Income Statement and Balance Sheet from Module 2 what is the projected CompuTech average outstanding Accounts Receivables? What is the company's Inventory Turnover rate?
Q3: If the company wished to exhibit a 30 day receivable average, what should their level of Accounts Receivable become? If they were able to invest the savings at 7% what would their impact on profits be?
Q4: If CompuTech's competition is experiencing a 6 X turnover on inventory, is CompuTech matching this performance, and if not what level of inventory should they be displaying?
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