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GenaCL600 [577]
3 years ago
6

Which one of these affects the length of the cash cycle but not the operating cycle? A) Inventory period B) Accounts payable per

iod C) Both the accounts receivable and inventory periods D) Accounts receivable period E) Both the accounts receivable and the accounts payable periods
Business
1 answer:
kifflom [539]3 years ago
4 0

Answer:

E) Both the accounts receivable and the accounts payable periods

Explanation:

The account receivable and the accounts payable affect the length of the cash cycle. This is because, the longer the cash cycle, the more likely a firm will need external financing.

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Financial objectives ________.a. relate to target outcomes that indicate a company is strengthening its market standing, competi
bogdanovich [222]

Answer:

The correct answer is letter "E": are necessary to set and to achieve because adequate profitability and financial strength increases a company's long-term health.

Explanation:

A company's financial objectives reflect the revenue the firm wants to earn out of the sale of goods or services. Organizations must meet those goals to ensure their operations will remain up and running. Otherwise, the association will have to look for other methods for financing their manufacturing processes and innovation which is likely leading them to ask for loans, thus, acquiring debt.

6 0
3 years ago
Mario owns a store that sells skateboard equipment. Mario understands that people are most likely to notice his headline text in
Shalnov [3]
What Mario should do from including this in his headline is being considerate on how he is doing from knowing how the people are going to be apparently right to give note in his own headline he created by using a text ad.
6 0
3 years ago
What amount of cash would result at the end of one year, if $15,000 is invested today and the rate of return is 8%
Leona [35]

Answer:

Amount of cash at the end of one year is $16,200

Explanation:

Amount invested = $15,000

Rate of return = 8%

Amount at the end of one year = $15,000 + (0.08×$15,000) = $15,000 + $1,200 = $16,200

6 0
3 years ago
The Campbell Company is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $940,000,
Tanya [424]

Answer:

a. Year 0 Net Cash Flows = $984,000

b. We have:

Year 1 net operating cash flows = $306,159

Year 2 net operating cash flows = $332,986

Year 3 net operating cash flows = $261,479

c. Additional Year 3- cash flow = $504,877

d. The machine should be purchased.

Explanation:

We start by first calculating the following:

Initial Investment = Base Price + Modification Cost = $940,000 + $25,000 = $965,000

Useful Life = 3 years

Depreciation in Year 1 = 0.3333 * $965,000 = $321,634.50

Depreciation in Year 2 = 0.4445 * $965,000 = $428,942.50

Depreciation in Year 3 = 0.1481 * $965,000 = $142,916.50

Book Value at the end of Year 3 = $965,000 - $321,634.50 - $428,942.50 - $142,916.50 = $71,506.50

After-tax Salvage Value = Salvage Value - (Salvage Value - Book Value) * Marginal tax rate = $624,000 – ($624,000 - $71,506.50) * 25% = $485,877

Initial Investment in NWC = $19,000

We can now proceed as follows:

a. What is the Year 0 net cash flow?

Year 0 Net Cash Flows = Initial Investment + Initial Investment in NWC = $965,000 + $19,000 = $984,000

b. What are the net operating cash flows in Years 1, 2, 3?

Year 1 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 1) = ($301,000 * (1 – 0.25)) + (0.25 * $321,634.50) = $306,159

Year 2 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 2) = ($301,000 * (1 – 0.25)) + (0.25 * $428,942.50) = $332,986

Year 3 net operating cash flows = (Pretax Cost Saving * (1 - tax)) + (tax * Depreciation in year 3) = ($301,000 * (1 – 0.25)) + (0.25 * $142,916.50) = $261,479

c. What is the additional Year 3- cash flow (i.e. after tax salvage and the return of working capital)?

Additional Year 3- cash flow = NWC recovered + After-tax Salvage Value = $19,000 + $485,877 = $504,877

d. If the project's cost of capital is 12%, should the machine be purchased?

This can be determined from the net present value (NPV) calculated as follows:

NPV = -$984,000 + ($306,159/1.12^1) + ($332,986/1.12^2) + ($261,479/1.12^3) + ($504,877/1.12^3) = $100,287.71

Since the NPV of the machine of $100,287.71 is positive, the machine should be purchased.

7 0
2 years ago
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $420,000; Allowance for Doub
Fiesta28 [93]

Answer and Explanation:

The computation is shown below:

a. Amount of adjusting entry for uncollectible accounts

= Estimated balance of Allowance for Doubtful Accounts + debit balance

= $16,400 + $4,000

= $20,400

b. Adjusted balances

For account receivable

= account receivable

= $420,000

For allowance for doubtful debts

= Estimated amount

= $16,400

For bad debts

= AMount of adjusting entry

= $20,400

c. Net realizable value

= Account receivable balance - estimated balance of Allowance for Doubtful Accounts

= $420,000 - $16,400

= $403,600

8 0
3 years ago
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