After the change in dso is reflected in balance sheet

Assignment Help Financial Management
Reference no: EM131966812

The industry average DSO is 30 (360-day basis). Collins plans to change its credit policy so as to cause its DSO to equal the industry average, and this change is expected to have no effect on either sales or cost of goods sold. If the cash generated from reducing receivables is used to retire debt (which was outstanding all last year and which has a 10% interest rate), what will Collins' debt ratio (Total debt/Total assets) be after the change in DSO is reflected in the balance sheet?

Reference no: EM131966812

Questions Cloud

How much will S company receive when the bonds are issued : The market rate on April 1st is 6%. How much will S company receive when the bonds are issued? Explain in detail
Type of confidence interval : Find the 95% confidence interval for the population mean of the price of movie tickets AND State what type of confidence interval you used
How do you think your own unique perception influences : How do you think your own unique perception influences the way you communicate? Be sure to cite resource material to support your claims
What is the probability that their mean math score : If you select 50 students, what is the probability that their mean Math score is more than 520.
After the change in dso is reflected in balance sheet : What will Collins' debt ratio (Total debt/Total assets) be after the change in DSO is reflected in the balance sheet?
What is stock current price : The required rate of return is rs= 15.5%, and the expected constant growth rate is g = 7.5%. What is the stock's current price?
Post the journal entries to the T-accounts : Post the journal entries to the T-accounts, using transaction dates as posting references in the ledger accounts. Label the balance of each account Bal
What salary represents the 15th percentile : What salary represents the 15th percentile? You MUST show what went into the calculator and then your final answer.
Difference between the two average wearing lives : (a) Test at level of significance a = 0.05 whether the difference between the two average wearing lives is significant.

Reviews

Write a Review

Financial Management Questions & Answers

  Considering new three-year expansion project

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.79 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be w..

  What minimum stock price would you be willing to convert

You purchase a $1000 face value convertible bond for $975. The bond can be converted into 150 shares of stock. The stock is currently priced at $5.25. At what minimum stock price would you be willing to convert?

  Earn on ordinary annuity for comparable rate of return

Hank made payments of $137 per month at the end of each month for 30 years to purrchase a piece of property. He promptly sold it for $123,067. What annual interest rate would he need to earn on an ordinary annuity for a comparable rate of return?

  Calculate the value of single ravioli share today

Ravioli Inc has just paid a (per share) dividend of $3.00. The required return is 10%. Calculate the value of a single Ravioli share today.

  Bonds two years ago at coupon rate

Heginbotham Corp. issued 20-year bonds two years ago at a coupon rate of 8.3 percent.

  Market has dividend payout ratio

Buster’s Market has a dividend payout ratio of 30 percent. The firm does not want to issue additional equity shares nor increase its debt at this time. The firm is profitable. Which one of the following defines the maximum rate at which this firm can..

  Unethical behavior or merely an investment strategy

What is your opinion of this type of arbitrage as it relates to foreign exchange—is this unethical behavior or merely an investment strategy?

  Repurchasing all of the outstanding shares

ACME is a very cyclical type of business which is reflected in its dividend policy. The firm pays a $2.00 a share dividend every other year. The last dividend was paid last year. Five years from now, the company is repurchasing all of the outstanding..

  Retirement investment

Retirement Investment Advisors, Inc., has just offered you an annual interest rate of 5 percent until you retire in 40 years.

  Value of synthetic put option using put-call parity

The value of a synthetic put option using put-call parity is closest to:

  Which firm is subject to higher degree of economic exposure

The parent of each firm subsidizes its respective research and development centre on an annual basis. Which firm is subject to a higher degree of economic exposure? Explain.

  Considering new three-year expansion project

Purple Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.67 million. The fixed asset will be depreciated straight-line to zero over its three-year tax life, after which time it will be..

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