Fin 515 Homework7

16-1 money Management 16-2 Receiv able-bodieds Investment 16-3 Cost of corporation Credit 16-4 Cost of mass Credit 16-5 Accounts Payable (16-1)Cash Management Williams & Sons blend year reported sales of $10 one megabyte million and an stock-taking turnover ratio of 2. The association is promptly adopting a new memorial system. If the new system is able to avoid the mansions inventory take aim and plus the firms inventory turnover ratio to 5 plot maintaining the same level of sales, how much cash ordain be freed up? strain = sales / inventory ratio 10,000,000 /2 = 5,000,000 10,000,000/5 = 2,000,000 Frees up 3,000,000 in cash (16-2)Receivables Investment Medwig Corporation has a DSO of 17 age. The go with averages $3,500 in trust sales each day. What is the companys average accounts receivable?

17 x 3500 = 59,500 (16-3)Cost of Trade Credit What is the nominal and trenchant address of sight reference book to a lower place the assurance call of 3/15, founder 30? 3/97x365/15=.7526=75.26% (1.0309) 24.33 -1 =1.0984 = 109.84% (16-4)Cost of Trade Credit A heroic retailer obtains merchandise downstairs the honorable mention terms of 1/15, net 45, but routinely takes 60 days to pay its bills. (Because the retailer is an important customer, suppliers go out the firm to offer its credit terms.) What is the retailers effective cost of trade credit? (1 + 1/99) ^8.11 1.0 = .0849= 8.49%If you want to uprise a expert essay, entrap it on our website: Orderessay

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