Exercise 2: Mr. Alphonse the finance manager of Headache Inc, kept turning over in his bed. His assistant M has forgotten to fill in in 2 critical numbers on the summary report about inventory management at the three stores they have. Store A started the years with 10 units in its inventory. It sold 1 unit each day and immediately bought one unit to replace the units sold. Thus the store the year with 10 unit in its inventory. The store had FIFO system of managing the inventory. Store B also started the with 10 units in its inventory. It also sold one unit cach day, but it did not replace the unit as soon as it was sold. Instead, it bought 10 units as soon as it sold the last unit in its inventory. It also under the with 10 units in inventory as well. Store C started the with 10 units in its inventory. It Sold 2 units cach day but did not replace the unit as soon as they were sold. Instead, it bought 10 units as soon as it sold the last units in its inventory. It also ended the year with 10 units and its inventory. Mr. Alphonse knew that he would face questions about the average and maximum number of days a unit remained in a store invented. Could you help Mr. Alphonse sleep peacefully by filling in the missing number in the following table (Mr. Aziz needs detailed calculation with explanations) Store A Store B Store C Maximum Number of days a unit Stays in the store Average Number of days a unit Stays in the store Exercise 3: ABC Company had a bad year in 2016; the company suffered net losses. Due to the losses, some of the measures of return deteriorated. Assume top management of ABC is pondering ways to improve its ratios for the following year. In particular, management is considering the following transactions: 1. Borrow S100 million on long-term debt. 2. Purchase treasury stock for $500 million cash. 3. Expense one-fourth of the goodwill carried on the books. 4. Create a new design division at a cash cost of $300 million. 5. Purchase patents from Johnson Co.. paying $20 million cash. Top management wants to know the effects of these transactions (increase, decrease, or no effect) on the following ratios: Transaction Rate of Return on Current Ratio Debt Ratio Common Stockholder's Equity 1. 2 3. 4. 5