a.

sales 287400
COGS 68%
average inventory 37800
profit margin 7%
tax rate 34%

inventory turnover 5.17 =COGS/average inv

inventory period 70.60 =365/inv turnover

b. annual sales 489500

COGS 59%
profit margin 6.10%
average acc receivable 41700

receivable turnover 11.73861

receivable period 31.09397

c. annual sales 761000

COGS 568000
profit margin 4.20%
accs payable period 37

payable turnover 9.864865 =365//acc payable period

average acc payable 57578.08 =COGS/payable turnover

d. operating cycle 208

inventory turnover 7.9
8.2

inventory increase, inventory period decrease, operating cycle decrease

before inventory period 46.20253
receivable period 161.7975

after inventory period 44.5122

after operating cycle 206.3097

e. inventory turnover 28.6

payable turnover 10.8
receivable turnover 14.4

inventory period 12.76224

payable period 33.7963
receivable period 25.34722
operating cycle 38.10946
cash cycle 4.313164

f. acc receivable period 38

 jan feb mar apr may
sales 9800 9500 13800 9500
collect in May
8/30 of Mar's sales 3680
22/30 of Apr's sales 6966.667
10646.67
a. Excess capacity in NWC means that company has high liquidability, so it does not need to collect receivables soon to meet o

b. less financial distress, because company can flexibly have more ways to increase funds for liquid problems,

c. “A restrictive policy is most appropriate when carrying costs are low relative to shortage costs”.
Disagree, high, keep less inventory,
with a restricitve policy, both carrying costs and shortage costs are low, but there is no comparison
between them.
d.
=carrying cost+restocking cost

e. purchase 2618
2/15, net 45

EAR 0.278643

f. sales 1330
average price per sofa 549
carrying cost per unit 31.6
orders 75 per sofa
fixed order cost 69 per order

EOQ 76.21173
ceivables soon to meet obligations.
a. average collection period 43
discount 1.10% immediately

r 0.098438

b. average collection period 23

discount 0.95 immediately

r 0.163557

c. sales 425860
COGS 64% of sales
avergae inventory 53600
profit margin 6%
tax rate 21%

inventory turnover 5.084896

inventory period 71.78122

d. annual sales 2800000

COGS 71% of sales
average acc receivable 227470
average acc payable 236595

payable turnover 8.402544

payable period 43.43922

e. sells 1380
average price 795
2/10, net 30

customer discount rate 76%

receivable period 14.8
receivable turnover 24.66216
average receivable 44485.15

f. sales 725
average price 750
2/10, net 30

customer discount rate 67%

receivable period 16.6
receivable turnover 21.98795
average receivable 24729.45

g. sales 2250
price per unit 199
2/7, net 30
 discount is taken 91%
receivable period 9.07
receivable turnover 40.24256
average receivable 11126.28

h. 1/5, net 20
66%

average collection period 10.1

i. acc receivable period 15

acc payable period 30
purchase 68% next quarter's sales
Q1 Q2 Q3 Q4
sales 16750 18220 17560 19710
order 12389.6 11940.8 13402.8 0
pay 12056.4 12090.4 12915.47 4467.6

j. purchases 67% next quarter's sales

acc payable period 60
Q1 Q2 Q3 Q4
sales 15900 16800 17500 16400
order 11256 11725 10988
pay 10854 11412.33 11479.33 7325.333

k. purchase 68% next quarter's sales

acc payable period 45
Q1 Q2 Q3 Q4
sales 38900 40600 58900 69200
order 27608 40052 47056
pay 27030 33830 43554 23528

l. collects

june july aug sep

sales 56700 68900 70200 54300
collections 68565
0.46 in aug
0.51 in july
0.02 in jun

m. jan feb mar apr may

sales 14700 16900 23500 36700 42300
collections 30100
0.5 in mar
0.5 in apr
n. sales 166569
COGS 94600
average inventory 21100
average acc payable 19600

inventory turnover 4.483412

inventory period 81.41121