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Working Capital Management

Multiple Choice-Working Capital: Cold Chiller Corporation, La Forks of Destiny, Inc.- How much does CCC have invested in its cash conversion cycle assuming a 365-day year? The average collection period for La Forks is ---------

Cold Chiller Corporation (CCC) has annual sales of $10 million, cost of goods sold of 60 percent, average age of inventory of 60 days, average collection period of 35 days, average payment period of 40 days, and purchases that are 50 percent of cost of goods sold. How much does CCC have invested in its cash conversion cycle assu

Organizational Working Capital

How would you define working capital? What could happen if an organization neglected to manage its working capital? What working capital techniques would you recommend for your organization? Why?

Dividend/Proforma Income Statement/Net Profit After Tax/Net Working Capital

1. Colonial Furniture's net profits before taxes for 2005 totaled $354,000. The company's total retained earnings were $338,000 for 2004 year end and $389,000 for 2005 year end. Colonial is subject to a 26 percent tax rate. How large was the cash dividend declared by Colonial Furniture in 2005? 2. In an effort to analyze Cloc

Networking Capital

Trying to solve for the networking capital Total Assets $900 Fixed Assets 600 Long-term 500 short-term 200

Current Assests

$300 inventory 600 fixed assets 200 accounts receivable 100 accounts payable 50 cash Looking for the total amount of the current assests

Cash Flows and Working Capital

A house painting business had revenues of $16,000 and expenses of $9,000. There were no depreciation expenses. However, the business reported the following changes in working capital. Beginning End Accounts receivable $1,200 $4,500 Accounts payable 7

Lawrence Sports Working Capital Policy

Create a working capital policy for Lawrence Sports that addresses their cash management needs for the long term. a. Compare Lawrence Sports' use of cash budgeting to the purpose of cash budgeting. Describe the weaknesses in Lawrence Sports' existing working capital policies that lead to their cash flow problem. b. The poli

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

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.

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

Equity Capital

Identify informal and formal investment sources of equity capital. Discuss how venture capital investors make decisions.

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?

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

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 Strategies

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

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

Working Capital

How do we "manage" the levels of working capital required in a business?

Best Mix of Capital

ACME Corp is a publicly traded firm listed on the NASDAQ. Its current common stock price is 10 dollars per share. The company currently has 75 million dollars in sales. It expects sales to grow at 3 percent a year for the next several years. The company's current fixed costs are 50 million dollars. The federal tax rate is 4

Stock/Capital Gain/Percentage Return

One year ago, Mr. Seth Cohen invested 10.400 dollars in 200 shares of First Industries Inc. stock and just received a dividend of 600$. Today he sold the 200 shares at 54.25$ per share. a. What was his capital gain? b. What was his total dollar return? c. What was his percentage return? d. What was the stocks dividend

Importance of Working Capital Management

Explain why working capital management has become increasingly important in the current business environment. Provide at least two examples of organizations that have good working capital management policies, and two examples of organizations with poor working capital management policies. Be sure to explain why the policies of y

Sources of Capital; Present Value Concept

For each of the following situations, the present value concept should be applied; 1. Your wealthy aunt has just established a trust fund for you that will accumulate to a total of $100,000 in 12 years. Interest on the trust fund is compounded annually at an 8% interest rate. How much is your trust fund today? 2. On Ja