Question
in details please. 1. A company is launching a new sales initiative and expects sales of $200,000 during the first year, and the gross profit
in details please.
1. A company is launching a new sales initiative and expects sales of $200,000 during the first year, and the gross profit margin to be 18%. To prepare for this, they plan to acquire 90 days worth of inventory. Their vendor will allow 30 days to pay its invoices. The company plans to sell only on account to its customers, so sales will be entirely credit based, and the average invoice is expected to take 30 days to collect.
The company expects sales, costs and net working capital to grow 6% per year. What will be the incremental investment in operating net working capital for year 1?
Enter your answer as a monetary amount rounded to four decimal places, but without the currency symbol. For example, if your answer is $90.1234, enter 90.1234
2. A company is launching a new sales initiative and expects sales of $200,000 during the first year, and the gross profit margin to be 18%. To prepare for this, they plan to acquire 90 days worth of inventory. Their vendor will allow 30 days to pay its invoices. The company plans to sell only on account to its customers, so sales will be entirely credit based, and the average invoice is expected to take 30 days to collect. What amount of net working capital should be included in the initial investment?
Enter your answer as a monetary amount rounded to four decimal places, but without the currency symbol. For example, if your answer is $90.1234, enter 90.1234
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