Answer:
The company's cash conversion cycle is 75 days
Explanation:
The conversion cycle is the number of days that a business takes to convert its investment in inventory into cash flowing from the purchase and sales of the business.
Conversion cycle = Payable days + Inventory in Stock days + Receivable days
where
Payable days = Purchases term = 30 days
Inventory in stock = Number of days until inventory remains unsold = 60 - 30 days = 30 days ( As payable days are already included in inventory conversion days )
Receivable days = Sales term = 15 days
Placing values in the formula
Conversion cycle = 30 days + 30 days + 15 days
Conversion Cycle = 75 days
Answer:
Control
Explanation:
Control in management as well as organization is very essential, it is very crucial for organization to achieve their goals. Control helps in the area of taking corrective measures whenever the needs arrises. It involves using technical as well as physical method in regulation of activities within an organization which will later reduces risk. It should be noted that control is
used to describe a technical, physical, or administrative process designed to reduce risk.
Answer:
Legitimate promissory notes are marketed to sophisticated, corporate investors that have the ability to thoroughly research the company issuing the notes and determine whether the issuer will be able to repay principal and interest. There have been many instances of "promissory note fraud" where unlicensed individuals push bogus promissory notes that are sold as investments that offer above-market fixed interest rates and safeguarding of principal - and most of there are frauds. This is a major concern to state regulators.
To offer a promissory note, both the salesperson and the note must be registered in the state. Only promisory notes that have maturities of 9 months or less, that are investment grade, and are sold in minimum increments of $50,000 are exempt from registration.
Finally, the tell-tale sign of fraud are:
Statements that tho notes are "guaranteed" or insured, especially by bogus foreign entities.
Promises of above-market rates fo return
Statements that the notes are "risk"free"
The labeling of a star-up company´s notes as prime
Offers of promissory notes from a stanger who does not know the costumer financial situation
Answer:
Project L is the better project as it has higher NPV and its IRR is 12.70%
Explanation:
- NPV of Project S as followed:
-1,000 + 895.03/(1+10.5%) + 250/(1+10.5%)^2 + 10/(1+10.5%)^3 + 5/(1+10.5%)^4 = $25.5
- NPV of Project L as followed:
-1,000 + 5/(1+10.5%) + 260/(1+10.5%)^2 + 420/(1+10.5%)^3 + 802.5/(1+10.5%)^4 = $67.
<u>=> Project L is the better Project as it has higher NPV.</u>
The IRR is the discount rate that puts the net present value of project's cash flows to 0 (zero).
- IRR of Project L as followed:
-1,000 + 5/(1+IRR) + 260/(1+IRR)^2 + 420/(1+IRR)^3 + 802.5/(1+IRR)^4 = 0 <=> IRR = 12.70%
Answer:
$47,000
Explanation:
The cash budget is a forecast of the company's expected movement in cash considering the expected outflows and inflows. This movements result in a change between the opening and ending cash balance. This may be expressed mathematically as
Opening balance + Cash receipts - Cash disbursed = ending balance
Cash receipts for the period
= $264,000
Cash disbursed
= $138,000 + $80,000 + $10,000 + $15,000
= $243,000
ending balance = $26,000 + $264,000 - $243,000
= $47,000
