Given: Credit sales $40,000M

Costs of goods sold 30,000M

Accounts receivable 3,600M

Inventory 2,000M

Accounts payable 4,000M

a. Compute the cash (conversion) cycle.

b. Associated Breweries is proposing a rights offering to finance a new beer product. There are 100,000 shares outstanding trading at $40 each. The company proposes to make a rights issue at $10 of one new share for each two shares held. Compute (i) the number of rights needed to buy one share; (ii) the new market value of the company; (iii) the ex-rights stock price; and (iv) the value of a right. < >