How much cash would be freed-up

Assignment Help Finance Basics

Reference no: EM13287575

Its cost of goods sold is 75% of sales, and it finances working capital with bank loans at an 8% rate. Assume 365 days in year for your calculations.

Stone Rock has:

$13 million of sales
$2 million of inventories
$3 million of receivables
$2 million of payables

If Stone Rock could lower its inventories and receivables by 9% each and increase its payables by 9%, all without affecting sales or cost of goods sold.

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: EM13287575

Questions Cloud

Find the change in currents using small signal model : Find the change in currents due to change of voltage by (a) 5mv, (b) -10mv, (c) 15mv using small signal model and exponential model of diode with n= 1 and biased at 2mA.

How many years before you can expect to pay cash : Assuming implied forward rates are the best estimates of future one-year rates, how many years before you can expect to pay cash for a used car if you invest in successive one-year bonds?

Find the minimum value of the index of refraction of glass : A glass sheet 1.40 ?m (micrometer) thick is suspended in air. Calculate the minimum value of the index of refraction of the glass sheet that produces this effect

Compute the volume the gas will occupy : Calculate the volume the gas will occupy if the pressure is increased to 1.87 while the temperature is held constant.

How much cash would be freed-up : Its cost of goods sold is 75% of sales, and it finances working capital with bank loans at an 8% rate. Assume 365 days in year for your calculations.

Determine the magnitude of the force on each side : A charge of 6.22 mC is placed at each corner of a square 0.170 m on a side. Determine the magnitude of the force on each side

What is the effective annual rate on your new loan : If you refinance your loan at the government rate, you will amortize the amount you still owe under the original mortgage over 30 years, and your payment will be $750 per month. What is the effective annual rate (EAR) on your new loan?

Explain a gas mixture of methane and steam : A gas mixture of methane and steam at atmospheric pressure at 773.15K is fed to a reactor, where the following reactions occur: CH4+H20->CO+3H2 and CO+H2O->CO2+H2

Find the electric field intensity a point 20cm above origin : Considure a circular disk in the x-y plane of radius 5.0 cm.Suppose the charge density is a function of radius such thatρs = 12ρ nC/cm2 (when ρis in centimeters). Find the electric field intensity a point 20.0cm above the origin on the z-axis.

User Account

All Pages