User Account

All Pages

What would be the total investment in ccc

Assignment Help Accounting Basics
Reference no: EM133173705

Question - X Pvt. Ltd. is a Canadian company and wishes to evaluate its cash conversion cycle (CCC). Your preliminary research has identified that on average the inventory is hold for 65 days; payment to suppliers takes 35 days; credit sales are collected in 55 days. The firm's annual sales are all on credit and amounts to 2.1 million CAD. Cost of goods sold is 67% of sales. Purchases is around 40% of cost of goods sold. Assume a 365-day year.

1. What is X's Products' operating cycle (OC) and cash conversion (CCC)?

2. How much has X Pvt. Ltd invested in (1) inventory, (2) accounts receivable, (3) accounts payable, and (4) the total CCC?

3. If X Pvt. Ltd shortened its cash conversion cycle by reducing its inventory holding period by 5 days, what would be the total investment in CCC?

4. You are asked to shorten Nepal handicraft's CCC by 5 days. Would you reduce the inventory holding period, the receivable collection period, or extend the accounts payable period? Why? What would be amount of reduction or extension in each case?

5. If majority of your receivables are customers in the US, what could you do to protect yourself from foreign currency exchange rate risk? Provide a realistic hedging based on USD and CAD.

6. Explain your work in detail.

Reference no: EM133173705

Questions Cloud

Record the previous financial transactions in the company : As the financial accountant of this company, you must record the previous financial transactions in the company's journal
Identity depositors at banks in the united states : Below are statistics about the identity of depositors at banks in the United States.
How many years will it take : Question - You are investing $900 each month at 9% compounded monthly. If you want to have $120,000, how many years will it take
What will be your total gain or loss : You bought 3 CALL-option contracts on CPT with a strike price of $150 for $16 each. What will be your total $ and % gain/loss
What would be the total investment in ccc : If X Pvt. Ltd shortened its cash conversion cycle by reducing its inventory holding period by 5 days, what would be the total investment in CCC
Maintaining knowledge of current legislation in real estate : PROJECT: Maintaining Knowledge of Current Legislation in real estate.
Prepare the statement of cost of goods manufactured : Statement of Cost of Goods Manufactured and Income Statement for a Manufacturing Company - Prepare the statement of cost of goods manufactured
Specific form of data collection approaches : Your first assignment is to resolve this problem. Describe in details how you would go about addressing this problem.
Evaluate the digital marketing practices : Choose one company that practices digital marketing in its operations. What is digital marketing and critically evaluate the digital marketing practices of the

Reviews

Write a Review

Accounting Basics Questions & Answers

  What is the main source of cash

What is the main source of cash? Operating, financing, or investing activities? Is this a financially healthy way for the corporation to obtain cash flows

  In the video that you watched a grocery clerk brought a

in the video that you watched a grocery clerk brought a woman that had gone into labor to the hospital using the

  How prepare the journal entries related to the bond payable

How Prepare the journal entries related to the bond payable for the last quarter of 2020. The entries should reflect the payment of interest

  Find the maximum capital cost allowance for the current year

At the beginning of the year the undepreciated capital cost of the building was $330,000. Find the maximum capital cost allowance for the current year

  Compute recaptured depreciation

What would be the cost of long-term debt for JT Bhd and Compute recaptured depreciation

  An auditor is examining loan receivables at a local bank

1. an auditor is examining loan receivables at a local bank. the population of loans contains two strata. one stratum

  Should be disclosed as non-adjusting events

The date the financial statements are authorized for issue, should be disclosed as non-adjusting events in accordance with PAS 10?

  Which is an objective of a normative accounting theory

Which is an objective of a normative accounting theory? Prescribe accounting measurement methods that provid useful information to investors

  When the patient tells the hospital that he will not be able

A governmental hospital provides $ 20,000 of services at established rates to a patient. The patient does not meet the hospital criteria for charity care. When the patient tells the hospital that he will not be able to pay the bill, how should the..

  Identify fraud risk factors

Identify fraud risk factors that were relevant to the BRIC audit. Explain how each of those fraud risk factors should have impacted the subsequent performance

  Suze and bess formed the suzy b company by making capital

suze and bess formed the suzy b company by making capital contributions of 130000 and 195000 respectively. they predict

  Explain the following generally accepted accounting

explain the following generally accepted accounting principles gaapa. going concernb. conservatismc.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd