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The following company has the following data: Balance sheet Beginning inventory 25,0000 Ending inventory 18,000 Beginning Account Receivable 7,500 Ending Account Receivable 5,000 Income Statement

The following company has the following data:

Balance sheet

Beginning inventory 25,0000
Ending inventory 18,000
Beginning Account Receivable 7,500
Ending Account Receivable 5,000

Income Statement

Net Sales Revenue 120,000
Cost of Goods Sold 70,000

Accordingly, calculate the Cash Gap and illustrate:

If the suppliers need to be paid after 45 days, is the company need a source of finance? If yes, the facilities needed to cover how many days?

How the company can cover the Gap?

What is the point of strength and weakness in the company operating cycle?

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