1. Sandhill Handicrafts, Inc., has net sales of $3.05 million with 50 percent being credit sales. Its cost of goods sold is $1.83 million. The firms cash conversion cycle is 32.0 days, and its operating cycle is 75.0 days. What is the firms accounts payable? (Use 365 days for calculation. Round final answer to the nearest whole dollar, e.g. 5,275.)

Accounts payable: _____

2. Wildhorse, Inc., has just set up a formal line of credit of $10 million with First Community Commercial Bank. The line of credit is good for up to five years. The bank will charge Wildhorse an interest rate of 5.92 percent on any amount borrowed, and the firm will pay an annual fee of 99 basis points on the unused balance. The firm borrowed $7.5 million on the first day the credit line became available. What is the effective interest rate on this line of credit? (Round answer to 2 decimal places, e.g. 12.25%.)

3.

Carla Vista Electrical, one of the largest generator dealers in Phoenix, sells about 2,100 generators a year. The cost of placing an order with its supplier is $600, and the inventory carrying costs are $160 for each generator. Carla Vista likes to maintain safety stock of 17 generators at all times.

What is the firms EOQ? (Round answer to 0 decimal places, e.g. 125.)

How many orders will the firm need to place this year? (Round answer to 0 decimal places, e.g. 1

What is the average inventory for the season? (Round answer to 0 decimal places, e.g. 125.)

Average inventory

_______