Cash conversion cycle-how much cash would be freed-up

Assignment Help Financial Management

Reference no: EM13918058

Primrose Corp has $20 million of sales, $3 million of inventories, $2 million of receivables, and $1 million of payables. Its cost of goods sold is 75% of sales, and it finances working capital with bank loans at an 9% rate. Assume 365 days in year for your calculations. Round intermediate steps to 2 decimal places.

What is Primrose's cash conversion cycle (CCC)? Round your answer to two decimal places.

days

If Primrose could lower its inventories and receivables by 11% each and increase its payables by 11%, all without affecting sales or cost of goods sold, what would be the new CCC? Round your answer to two decimal places.

days

How much cash would be freed-up? Round your answer to the nearest cent.

By how much would pre-tax profits change? Round your answer to the nearest cent.

Reference no: EM13918058

Questions Cloud

Analyze benefits to the company of conducting business : Analyze the benefits and costs to the company of conducting business in an ethical way. Assess the company's unethical action(s) in terms of how the unethical behavior may hurt the company.

Management function of controlling : What is the management function of controlling as related to performance improvement? What tools are used to measure and monitor performance? Please describe at least two functions and two tools in your response.

Salaries for statisticians : Problem1 complete solutions correct answers key Example - What test would you use to determine whether the starting salaries for statisticians are greater than $80,000? Ans. - One-sample t-test for population mean, Ho: μ=$80,000 vs. Ha: μ >$80,000

What is juvenile diversion : What is juvenile diversion? Why were these types of programs developed and what types of youth are these programs geared toward

Cash conversion cycle-how much cash would be freed-up : Primrose Corp has $20 million of sales, $3 million of inventories, $2 million of receivables, and $1 million of payables. Its cost of goods sold is 75% of sales, and it finances working capital with bank loans at an 9% rate. What is Primrose's cash c..

Selected product at in the product life cycle : Select a product with which you are familiar. What stage is your selected product at in the product life cycle? Provide rationale for your answer. Based on your knowledge of the product life cycle, what types of changes will occur to your selected..

Operating activities section of the statement of cash flows : Pella Company presents its statement of cash flows using the indirect method.

How does type of program to be analyzed influence : Provide an example in which either quantitative or qualitative analysis might work better than the other to develop a valid recommendation from the stakeholder perspective.

What is restorative justice : What is Restorative Justice? Why is the Restorative Justice model so compatible with the treatment and rehabilitation needs of juvenile offenders

User Account

All Pages