Answer:
The value of cash and marketable securities amounts to 2.01 million
Explanation:
The formula of Current Ratio is:
Current Ratio = Current Assets / Current Liabilities
Current Assets = Current Ratio × Current Liabilities
= 1.60 × $11.7
= $18.72 million
Computation of Inventory:
Inventory turnover ratio = Sales / Inventory
12.1 = $119/ Inventory
Inventory = $119 / 12.1
= 9.83 million
Computation of Accounts Receivable:
Average collection period = 365 / Accounts Receivable Turnover ratio
21 = 365 / Accounts Receivable Turnover ratio
Accounts Receivable Turnover ratio = 365 / 21
= 17.38
Accounts Receivable Turnover ratio = Sales / Accounts Receivable
= $119 / Accounts ReceivableTurnover ratio
Accounts Receivable = $119 / 17.28
= $6.88 million
Computation of Cash and Marketable Securities:
Current Assets = Inventory + Accounts Receivable + Cash and Marketable Securities
Cash and Marketable Securities = Current Assets -Inventory - Accounts Receivable
= 18.72 -9.83 - 6.88
= 2.01 million
