Cash conversion cycle based on balance sheetgates

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Reference no: EM13356126

Cash Conversion cycle Based On Balance Sheet

Gates Industries balance sheet and income statement for the year ending December 31, 1978 are as follows:

Balance Sheet ($million)  

Cash

$ 10.0

Accounts payable

$ 15.0

Accounts receivable

15.0

Salaries, benefits, & payroll taxes payable

3.0

Inventories*

12.0

Long-term debt

15.0

Fixed assets (net)

30.0

Stockholder' equity

34.0

Total Assets

$ 67.0

Total liabilities & stock equity

67.0  

Income Statement ($million)

Net sales (all credit)

$ 125.0

Cost of sales

75.0

Selling, general, & administration expenses

30.0

Other expenses

13.0

Earnings after tax

7.0





 

*Note: Average inventories also equal $12.0 (million)
Determine the length of the firm's cash conversion cycle.

Reference no: EM13356126

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