Question

Referring to the following data of the Omani Company, that extracted from the balance sheet at...

Referring to the following data of the Omani Company, that extracted from the balance sheet at 31\12\2019, answer the following questions: - (Note; Write all Equations regarding the questions)

  1. The company manager targets to reduce the current ratio in the year (2020) by 33% from the previous year (2019), this requiring to downsize the amount of the total current asset. To what level can the manager reduce the total current asset to achieve this target at (2020)? (Suppose the other things are fixed)

  2. The manager put a plan to reduce the selling period in the (2020) by (16.7%) from the previous year (2019). Calculate the new inventory turnover.

(Suppose the other things are fixed)

  

Data of 2019

Total Asset Turnover

2 Times

Net Fixed Asset

400 (Thousand OMR)

Total Liabilities

400 (Thousand OMR)

Sales

2000 (Thousand OMR)

Quick Ratio

1.5 Times

Accounts Receivable

150 (Thousand OMR)

Long-term Liabilities

200 (Thousand OMR)
Business   Accounting   
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Answer #1

Note : Amounts mentioned above are in Thousands of OMR.

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