A firm is considering several policy changes to increase sales. It will increase the variety of goods it keeps in inventory, but this will increase inventory by $11,900. It will offer more liberal sales terms, but this will result in average receivables increasing by $68,800. These actions are expected to increase sales by $819,000 per year, and cost of goods will remain at 70% of sales. Because of the firm's increased purchases for its own production needs, average payables will increase by $36,900. What effect will these changes have on the firm's cash cycle? (Use 365 days in a year. Do not round your intermediate calculations. Round your answer to 2 decimal places.)
A firm is considering several policy changes to increase sales. It will increase the variety of goods it keeps in inventory, but this will increase inventory by $11,900. It will offer more liberal sales terms, but this will result in average receivables increasing by $68,800. These actions are expected to increase sales by $819,000 per year, and cost of goods will remain at 70% of sales. Because of the firm's increased purchases for its own production needs, average payables will increase by $36,900. What effect will these changes have on the firm's cash cycle? (Use 365 days in a year. Do not round your intermediate calculations. Round your answer to 2 decimal places.)
Essentials of Business Analytics (MindTap Course List)
2nd Edition
ISBN:9781305627734
Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson
Chapter6: Statistical Inference
Section: Chapter Questions
Problem 29P: Carpetland salespersons average 8,000 per week in sales. Steve Contois, the firms vice president,...
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A firm is considering several policy changes to increase sales. It will increase the variety of goods it keeps in inventory, but this will
increase inventory by $11,900. It will offer more liberal sales terms, but this will result in average receivables increasing by $68,800.
These actions are expected to increase sales by $819,000 per year, and cost of goods will remain at 70% of sales. Because of the
firm's increased purchases for its own production needs, average payables will increase by $36,900. What effect will these changes
have on the firm's cash cycle? (Use 365 days in a year. Do not round your intermediate calculations. Round your answer to 2
decimal places.)
X Answer is complete but not entirely correct.
Change in cash cycle
44 55 X days
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