Tim Gillespie FIN 440 Week 3 Homework Chapter 21 Problems 6, 12 and 14 21-6 A. What is the days sales outstanding? DSO = 28 B. What is the average amount of receivables? Average Amt Receivables = $2,500.00 e amount of receivables would be $2500 per day. This is sales divi C. What would happen to receivables if McDowell toughened up on its collection policy with the result that all nondiscount customers paid on the 30th day? DSO = 22 Average Amt Receivables $2,500.00 21-12 A. Calculate Christies cash conversion cycle. Inventory Conversion Period + Receivables Collection Period - Payables Deferral Period = Cash Conversion Cycle Inventory Conversion Period = 73 Receivables Collection Period = 36.5 Payables Deferral Period = 40 CCC = 69.5 B. Assuming Christie holds negligible amounts of cash and marketable securities, calculate its total assets turnover and ROA. Total Asset Turnover = Sales / Total Assets Total Asset Turnover = 1.875 ROA = 11.25% 21-14 A. THE CASH BUDGET for Koehl's Doll Shop
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Generally Accepted Accounting Principles, cash conversion cycle, Christie, Payables deferral period