16.1 Williams & Sons Cash Freed Up
16-1 Williams & Sons last year reported sales of $10 million and an inventory turnover ratio of 2. The company is now adopting a new inventory system. If the new system is able to reduce the firm's inventory level and increase the firm's inventory turnover ration to 5, while maintainin the same level of sales how much cash will be freed up?
The solution explains how to calculate the freed up cash.
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