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Luba_88 [7]
3 years ago
6

Marshall Inc. recently hired your consulting firm to improve the company's performance. It has been highly profitable but has be

en experiencing cash shortages due to its high growth rate. As one part of your analysis, you want to determine the firm's cash conversion cycle. Using the following information and a 365-day year, what is the firm's present cash conversion cycle
Business
1 answer:
dezoksy [38]3 years ago
3 0

Answer:

148.02 days

Explanation:

The computation of the cash conversion cycle is shown below:

As we know that

Cash conversion cycle is = Days inventory outstanding + days sale outstanding - days payable outstanding

where,

Number of days inventory outstanding is

= Average inventory ÷ cost of goods sold per day

= $75000 ÷ ($360,000 ÷ 365 days)

= 76.04 days

Number of days sales outstanding is

= Average account receivable ÷ Average sales per day

= $160,000 ÷ ($600,000 ÷ 365)

= 97.33 days

And, the number of days payable outstanding is

= Average accounts payable ÷ cost pf goods sold per day

= $25,000 ÷ ($360,000 ÷ 365)

= 25.35 days

So, the cash conversion cycle is

= 76.04 days + 97.33 days - 25.35 days

= 148.02 days

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Glassmaker has pre-merger $5 in debt and $10 in equity. Rate on debt is 11%. The risk free rate is 6%. The tax rate is 40% . The
Marysya12 [62]

Answer:

The answer is 11.44%

Explanation:

Solution

Given that:

Glass maker has a pre-merger of =$5 debt

Equity =$10

The rate on debt =11%

The risk free rate =6%

Tax rate =40%

The levered beta is =1.36

Equity risk premium is= 4%.

Now,

the next step is to find discount to use for Glass maker free cash flows and interest tax savings

Cost of equity (Ke) =  Risk free return + Beta ( Market return - Risk free return )

= 6% +1.36( 10%-6%)

=11.44%

Therefore, the rate to be used to discount free cash flows and interest tax savings is 11.44%

6 0
3 years ago
If the quantity of real domestic output demanded increased by $1,000 at each price level, the new equilibrium price level and qu
NeTakaya

If the quantity of real domestic output demanded increased by $1,000 at each price level, then, according to macroeconomics, the new equilibrium price level and quantity of real domestic output would be 150 and $4,000.

<h3><u>What is macroeconomics?</u></h3>
  • Macroeconomics is a subfield of economics that focuses on the behavior of an economy as a whole, including the market and other large-scale processes.
  • Inflation, price levels, economic growth rates, national income, gross domestic product (GDP), and variations in unemployment are only a few examples of the phenomena that macroeconomics analyzes.
  • Macroeconomics makes an effort to assess how well an economy is operating, comprehend the forces that shape it, and predict how performance could increase.
  • In contrast to microeconomics, which focuses primarily on the decisions made by individual economic actors, macroeconomics examines the functioning, structure, and behavior of the entire economy (like people, households, industries, etc.).

Curves of supply and demand cross at the equilibrium price. We would forecast that the market will function at this pricing.

Know more about macroeconomics with the help of the given link:

brainly.com/question/13120341

#SPJ4

6 0
1 year ago
Which type of insurance has flexible premium payments? A. automobile liability insurance B. earthquake insurance C. index univer
vlada-n [284]
The best answer here would be
C.) index universal life insurance.
With life insurance it's not required by the state, therefore, you get to choose a specific plan that fits your desire for payments.

6 0
3 years ago
Are sources of revenue for both federal and state governments. Individuals pay this tax from the money they
marusya05 [52]

Answer:

Personal income taxes

Explanation:

Personal income tax is imposed on salaries, wages, interests, and other income an individual earns throughout the year. The government of the country that the person earned their income imposes the tax. Income tax is levied on the income generated by a person or a business in a country.

Income tax is the most important source of revenue for governments. In almost all countries, the tax agencies employ a progressive system of determining the tax amount for each individual. A person with a high income pays higher taxes compared to the one with moderate earnings.

8 0
3 years ago
Suppose two factors are identified for the U.S. economy: the growth rate of industrial production, IP, and the inflation rate, I
mash [69]

Answer:

14.4%

Explanation:

Calculation for what will be your expected rate of return on the stock.

Expected rate of return on the stock=12% + 1(5%-4%) + .7(8%-6%)

Expected rate of return on the stock=12%+1(1%)+.7(2%)

Expected rate of return on the stock=12%+1%+1.4%

Expected rate of return on the stock=14.4%

Therefore your expected rate of return on the stock is 14.4%

7 0
2 years ago
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