Calculate christies cash conversion cycle

Assignment Help Finance Basics

Reference no: EM13280588

Christie Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Christie's 2011 sales (all on credit) were $150,000; its cost of goods sold is 80% of sales; and its earned a net profit of 6%, or $9,000. It turned over its inventory 6 times during the year, and its DOS was 36.5 days. The firm had fixed assets totaling $35,000. Chirstie's payables deferral period is 40 days.
a. Calculate Christie's cash conversion cycle.
b. Assuming Christie holds negligible amounts of cash and marketable securities, calculate its total asset turnover and ROA.
c. Suppose Christie's managers believe that the inventory turnover can be raised to 9.0 times. What would Christie's cash conversion cycle, total assets turnover, and ROA have been if the inventory turnover had been 9.0 for 2011? Show all calculations

Reference no: EM13280588

Questions Cloud

Explain the appropriate number of moles of reactant : Consider the following Balanced equation: SiO2+3C--->SiC+2CO: Complete the following table, showing the appropriate number of moles of reactant and products

Describe how to find moment of inertia : Provide equations allowing to find moment of inertia of a solid cylinder and of a cylindrical ring

What would be the current drawn by two such bulbs : Consider the problem of using a low-voltage system to power a small cabin. Suppose a 12-V system powers a pair of 100-W lightbulbs (wired in parallel). a. What would be the (filament) resistance of a bulb designed to use 100 W when it receives 12 V

What is concentration in moles per liter must the hydroxide : A metal-plating waste contains 20mg/L Cu2+, and it is desired to add Ca(OH)2 to precipitate all but 0.5mg/L of the copper. To what concentration in moles per liter must the hydroxide concentration be raised to accomplish this? Ans: 1.6*10^-7 mol/L

Calculate christies cash conversion cycle : Suppose Christie's managers believe that the inventory turnover can be raised to 9.0 times. What would Christie's cash conversion cycle, total assets turnover, and ROA have been if the inventory turnover had been 9.0 for 2011? Show all calculation..

What is the diameter of the piston : A 70.0 kg person balances a 1250 kg elephant which is standing on a circular lift of diameter 2.00 m. What is the diameter of the piston

How the maxwell-boltzmann approximation accurate : The Maxwell-Boltzmann distribution is often used to approximate the Fermi- Dirac distribution function. For what range of (E-Ef)/kT is the Maxwell-Boltzmann approximation accurate to within 10%

Explain chemical for removing calcium ions from water : the following is the better chemical for removing calcium ions from water. Make sure you show the calculations necessary

Promote pneumococcal vaccination : Based on promising results from laboratory studies, we hypothesized that pneumococcal vaccination would protect patients from myocardial infarction.

User Account

All Pages