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Assignment on receivables investment

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Receivables investment

Lamar Lumber Company has sales of $12 million per year, all on credit terms calling for payment within 30 days; and its accounts receivable are $1.8 million. Assume 365 days in year for your calculations.

  1. What is Lamar's DSO? Round your answer to two decimal places. _________________days
  2. What would DSO be if all customers paid on time? Round your answer to two decimal places. ______________________days
  3. How much capital would be released if Lamar could take actions that led to on-time payments? Round your answer to the nearest cent.  $  _______________

Reference no: EM132455553

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