Question
Red Hamster Manufacturing Inc. has forecasted sales of $27,000,000 for next year and expects its cost of goods sold (COGS) to remain at 70% of
Red Hamster Manufacturing Inc. has forecasted sales of $27,000,000 for next year and expects its cost of goods sold (COGS) to remain at 70% of sales. Currently, the firm holds $2,900,000 in inventories, $1,800,000 in accounts receivable, and $2,700,000 in accounts payable.
Approximately how long does it take Red Hamster Manufacturing to convert its raw materials to its finished products and then to sell those goods? (Note: In all calculations, assume that there are 365 days in a year.)
56.01 days
42.01 days
58.81 days
50.41 days
On average, it takes ________days from the time a sale is made until the time cash is collected from customers.
Red Hamster Manufacturing relies on customer credit when it buys raw materials from its suppliers. On average, it takes ______ days after the firm purchases materials before it sends cash to its suppliers.
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