Working capital cash flow cycle and cash conversion cycle

Assignment Help Financial Management

Reference no: EM131511784

Working Capital Cash Flow Cycle

Strickler Technology is considering changes in its working capital policies to improve its cash flow cycle. Strickler's sales last year were $120,000 (all on credit), and it earned a net profit of 5%. Its inventory turnover was 6.0996 times during the year, and its DSO was 32.5 days. Its annual cost of goods sold was $121,992. The firm had fixed assets totaling $33,000. Strickler's payables deferral period is 45 days. Assume 365 days in year for your calculations. Do not round intermediate calculations.

Calculate Strickler's cash conversion cycle. Round your answer to two decimal places.

days

Assuming Strickler holds negligible amounts of cash and marketable securities, calculate its total assets turnover. Round your answer to two decimal places.

Calculate its ROA. Round your answer to two decimal places.

Suppose Strickler's managers believe that the inventory turnover can be raised to 8 times without affecting sales and cost of goods sold. What would Strickler's cash conversion cycle have been if the inventory turnover had been 8 for the year? Round your answer to two decimal places.

days

What would Strickler's total assets turnover have been if the inventory turnover had been 8 for the year? Round your answer to two decimal places.

What would Strickler's ROA have been if the inventory turnover had been 8 for the year? Round your answer to two decimal places.

Reference no: EM131511784

Questions Cloud

What is the source of the gain in this transaction : What is the gain to Amazon with this lease rate? What is the source of the gain in this transaction?

Price of the bonds at each of the years to maturity : Assuming that the yield to maturity of each bond remains at 8.5% over next 4 years, calculate the price of the bonds at each of the following years to maturity.

Calculate your annual average compound return : Calculate your annual shareholder return for each of the two years you owned the stock. Calculate your annual average compound return.

Bond valuation : Bond valuation An investor has two bonds in his portfolio that both have a face value of $1,000 and pay a 8% annual coupon.

Working capital cash flow cycle and cash conversion cycle : Calculate Strickler's cash conversion cycle. What would Strickler's total assets turnover have been if the inventory turnover had been 8 for the year?

How do investors demand to be compensated for risk : How do investors “demand” to be compensated for risk? Why aren’t investors compensated for diversifiable (unsystematic) risk?

Bond value and time constant required returns : Bond value and time Constant required returns. Find the present values of the bond with different years to maturity.

Identify ten pairs of companies with sources of synergy : Identify 10 pairs of companies with sources of synergy.

The required real rate of return has increased : Due to economic uncertainty, the required real rate of return has increased. This will most likely:

User Account

All Pages