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Andrej [43]
3 years ago
11

Garcia Industries has sales of $200,000 and accounts receivable of $18,500, and it gives its customers 25 days to pay. The indus

try average DSO is 27 days, based on a 365-day year. If the company changes its credit and collection policy sufficiently to cause its DSO to fall to the industry average, and if it earns 8.0% on any cash freed-up by this change, how would that affect its net income, assuming other things are held constant?
Business
1 answer:
katrin2010 [14]3 years ago
6 0

Answer:

$488.77

Explanation:

Rates : 8%

Sales : 167,500

A/R : 18,500

Days in Year 365

Sales/Day: 458.90

DSO : 40

Industry DSO : 27

(x / 167,500) x 365 = 27

Solve x = 12,390.41

x = This is the sum to be deducted for receivable accounts.

18500 - 12,390.41 = 6,109.59 decrease in Accounts Receivable

6,109.59 x 8% = 488.77

Interest earned and net revenue generated.

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Anastaziya [24]

Answer:

"Try something and if it doesn't work, admit it and try something else."

Explanation:

When I took US Government, my teacher always emphasized that FDR was probably the best American President, and things like this really show why he admired him so much. Can you imagine those words coming out of the mouth of a modern politician?

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3 years ago
If a johnny rocket's burgers has 11,500 burgers in inventory on hand and they sell 1,000 units a day, how many days of inventory
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8 0
3 years ago
REV Co. is reviewing the accounting and disclosure requirements for its significant guarantees, commitments, and contingencies,
victus00 [196]

Answer:

REV Co. has made disclosure in notes to the financial statement section. The disclosures include the details about related party transaction which was carried out by the brother of Chief Operating Officer. It is ensured that the transaction was completed on arm's length.

Explanation:

Disclosures are mandatory for any company which is listed. The companies provide details of specific transactions in Notes to the Financial statements. These additional information provides details of transaction to the shareholders and removes any ambiguity in the transaction. The purpose of disclosures is to ensure the shareholders that the company has not incurred any fraudulent activity in certain transactions and all transactions are fair and complies with International Accounting Standards.

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3 years ago
Suppose that a consumer has a health insurance program with co-payments of $10 per doctor visit. If the consumer purchases 6 doc
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Answer:

$300

Explanation:

Given that s a health insurance program with co-payments of $10 per doctor visit.

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amount paid by insurance in 1 visit = $10

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