Business Finance
Theory Questions
Define working capital? How is it measured?
Calculate the amount of working...
Business Finance
Theory Questions
Define working capital? How is it measured?
Calculate the amount of working capital for Snider
Corporation
SNIDER
CORPORATION
Balance Sheet
December 31, 2010
Assets
Current assets:
Cash..................................................................................
$ 50,000
Marketable
securities....................................................
20,000
Accounts receivable
(net)............................................. ......
160,000
Inventory......................................................................
.... 200,000
Total current
assets....................................................... ....
$430,000
Investments..................................................................
........ 60,000
Plant and
equipment............................................................
600,000
Less: Accumulated
depreciation.................................. ..... (190,000)
Net plant and
equipment............................................... ...
410,000
Total
assets...................................................................
.... $900,000
Liabilities and Stockholders’
Equity
Current liabilities
Account
payable..............................................................
1) Other things held constant, which strategy would tend to
reduce the cash conversion cycle?
a....
1) Other things held constant, which strategy would tend to
reduce the cash conversion cycle?
a.
placing larger orders for raw materials to take advantage of
price breaks
b.
maintaining the same level of receivables as sales decline
c.
Increasing the inventory conversion period
d.
lengthening the payables deferral period
2) Your company has been offered credit terms of 3/30, net 90
days. What will the nominal annual cost of trade credit be if you
pay 100 days after the...
A firm had current assets of $50,000, net fixed assets of
$250,000, current liabilities of $...
A firm had current assets of $50,000, net fixed assets of
$250,000, current liabilities of $ 30,000, and long-term debt of
$100,000
What is the firm’s stockholder equity?
What is the net working capital?
If its current liabilities consist of $20,000 in accounts
payable and $10,000 in short-term debt (notes payable), what is the
firm’s net working capital?
Your submission must include and indicate clearly which
EQUATIONS from the textbook that you have used, and must show steps
in details...
Which of the following statements is correct?
Group of answer choices
If carrying costs dominate shortage...
Which of the following statements is correct?
Group of answer choices
If carrying costs dominate shortage costs, the firm will need to
move toward a more flexible policy.
Under the restrictive current asset management strategy, the
current assets are kept at a minimum.
The downside of restrictive current asset management strategy is
the high carrying cost associated with owning a high level of
inventory and providing liberal credit terms to customers.
With the maturity matching strategy, all seasonal working
capital...
Current Assets 30,000,000 Current Liabilities 20,000,000
Fixed Assets 70,000,000 Notes Payable 10,000,000
Total Assets: 100,000,000 Long-term...
Current Assets 30,000,000 Current Liabilities 20,000,000
Fixed Assets 70,000,000 Notes Payable 10,000,000
Total Assets: 100,000,000 Long-term debt 30,000,000
Common Stock 1,000,000
Retained Earnings 39,000,000
Total liabilities & Equity 100,000,000
The notes payable are to banks, and the interest rate on this
debt is 7%, the same as the rate on new bank loans. These bank
loans are not used for seasonal financing but instead are part of
the company's permanent capital structure. The long-term debt
consists of 30,000 bonds, each...