Question
A.The sales of Barakah Bhd amounting to RM1,062,500, 25% are cash sales. The cost of goods sold is 36% of sales. The average inventory is
A.The sales of Barakah Bhd amounting to RM1,062,500, 25% are cash sales. The cost of goods sold is 36% of sales. The average inventory is RM45,000. The receivable is collected 6 times in a year and account payable is paid 30 days after it arises. The firm`s annual working capital investment is RM700,000. The firm`s required return on investment is 6%. Assuming 360 days a year.
a.Calculate the firm`s cash conversion cycles.
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Practical Financial Management
Authors: William R. Lasher
7th edition
128560721X, 9781133593669, 1133593682, 9781285607214, 978-1133593683
