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    Working Capital Management

    Working Capital Policies: Scott Equipment Organization

    Scott Equipment Organization is investigating the use of various combinations of short-term and long-term debt in financing its assets. Assume that the organization has decided to employ $30 million in current assets, along with $35 million in fixed assets, in its operations next year. Given the level of current assets, anticipa

    Factoring of Receiveables (Working Capital)

    I need to know the answers to these questions. 1. Explain the advantages and disadvantages to the firm of factoring its receivables. What is the difference between pledging and factoring? Which of these two is cheaper for the company? 2. What main points of analysis will a bank perform on a loan application? 3. Is an

    Net Working Capital

    Determine the change in net working capital that appears warranted for the following proposed project: Inventory levels will increase 20% from their current value of $500,000; cash will increase by $25,000; wage accruals will increase by $60,000; machinery will increase by $75,000; accounts receivable -- because of a new collect

    Goals of Managing Working Capital

    A new computer system allows your firm to more accurately monitor inventory and anticipate future inventory shortfalls. As a result, the firm feels more able to pare down its inventory levels. What effect will the new system have on working capital and on the cash conversion cycle?

    Financing Technique and Management Teams

    Describe a short term financing technique and/or instrument with which you are familiar. How are they used in practice? Using a company with which you are familiar, briefly describe in general terms how management teams might manage working capital by focusing operational efforts on a current asset or current liability.

    Working Capitals

    Define the purpose of working capital. How does extending credit affect working capital requirements and the cash conversion period (cycle)? Evaluate the consequences of inventory costs on Working Capital needs and the Cash Conversion Period.

    Most Correct Statement

    Which of the following statements is most correct? a. In the weighted average cost of capital calculation, we must adjust the cost of preferred stock for the tax exclusion of 70 percent of dividend income. b. We ideally would like to use historical measures of the component costs from prior financings in estimating the app

    Fixed and WC investment drivers

    What factors are likely to drive a firm's outlays for new capital (such as plant, property, and equipment) and for working capital (such as receivables and inventory)? What ratios would you use to help generate forecasts of these outlays?

    Working Capital Management for Carroll & King Corporation

    Carroll & King Corporation has $5 million of inventory and $2 million of accounts receivable. Its average daily sales are $120,000. The company's payables deferral period (accounts payable divided by daily purchases) is 30 days. What is C&K's cash conversion cycle? A. 24 B. 26 C. 27 D. 28 E. 30

    Working Capital Management

    Schoof Inc. expects to have sales of $30,000 in January, $35,000 in February, and $40,000 in March. If 20% of sales are for cash, 40% are credit sales paid in the month following the sale, and another 40% are credit sales paid 2 months following the sale, what are the cash receipts for the firm in March? A. $29,151 B. $30

    Working Capital Management: "Free" Trade Credit Calculation

    Filbeck Company (Buskirk Construction) buys on terms of 2/15, net 30 days. It does not take discounts, and it typically pays 30 days after the invoice date. Net purchases amount to $500,000 per year. On average, how much "free" trade credit does the firm receive during the year? (Assume a 365-day year.) A. $20,548 B. $

    Working Capital Management

    Need Assistance on the following question:Identify and discuss two metrics available for working capital management. Explain the metric and their role in this critical area. Also discuss any ways the metric can be improved to aid the firm's cash position.

    Long Term Capital Management

    Considering the executive team, what were the problems with team inputs, processes and structures that contributed to the downfall of Long Term Capital Management? Were the members of LTCM simply unlucky (the victim of forces beyond its control) or were there more systematic, predictable (and, ultimately, avoidable) reasons for

    Paid In Capital Computations

    Presented below is information related to Edis Corporation: Common Stock, $1 par $4,300,000 Paid-in Capital in Excess of Par?Common Stock 550,000 Preferred 8 1/2% Stock, $50 par 2,000,000 Paid-in Capital in Excess of Par?Preferred Stock 400,000 Retained Earnings

    Stockholders Equity and Paid-In Capital for Edis Corporation

    Presented below is information related to Edis Corporation: Common Stock, $1 par $4,300,000 Paid-in Capital in Excess of Par?Common Stock 550,000 Preferred 8 1/2% Stock, $50 par 2,000,000 Paid-in Capital in Excess of Par?Preferred Stock 400,000 Retained Earnings

    Working Capital Management

    Indicate how each of the following six different transactions that Dynamic Mattress might make would affect (i) cash and (ii) net working capital:

    Working Capital Strategies

    What ethical implications arise as a result of an organization employing various working capital strategies to realize long-term opportunities.

    The Cost of Capital

    LePage Co. expects to earn $2.50 per share during the current year, its expected payout ratio is 55%, its expected constant dividend growth rate is 6.0%, and its common stock currently sells for $22.50 per share. New stock can be sold to the public at the current price, but a flotation cost of 5% would be incurred. What would

    Working Capital for Pula Paper

    Pula Paper Ltd is a manufacturer of facial tissues. The company needs to borrow $1,000,000 to help finance seasonal inventory build-up prior to the Lunar New Year. The company is considering the following alternatives for financing its working capital. Option A: The company may issue $1,000,000 in 180-day maturity commercial

    Property transaction: Section 1231 and recapture provisions

    Yoshida owns two parcels of business land (Section 1231 assets). One parcel can be sold at a loss of $30K, and the other parcel can be sold at a gain of $40K. Yoshida has no norecaptured Section 1231 losses from prior years. The parcels could be sold at any time because potential purchasers are abundant. Yoshida has a $25K s