Question
The Red Company has the following current assets and liabilities for these two years: The Red Company 2018 2019 Cash and Marketable Securities $ 40,000
The Red Company has the following current assets and liabilities for these two years:
The Red Company | 2018 | 2019 |
Cash and Marketable Securities | $ 40,000 | $40,000 |
Accounts Receivable | 310,000 | 360,000 |
Inventories | 350,000 | 500,000 |
Total Current Assets | $700,000 | $900,000 |
Accounts Payable | $200,000 | $250,000 |
Bank Loan | 0 | 150,000 |
Accruals | 150,000 | 200,000 |
Total Current Liabilities | $350,000 | $600,000 |
If sales in 2018 were $1.3 million, sales in 2019 were $1.4 million, and cost of goods sold was 70 percent of sales, how long were The Red Company's operating cycles and cash conversion cycles in each of these years?
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