ABC Co. is a manufacturing company and its selected financial statements items are given as following. Net Salesequals to 32000 for the year 2020 and 28000 for the year 2019. COGS equals to 24000 and 21000 respectively for the4 -year 2020 and 2019. Accounts Receivable for the year 2020 equals to 8500 and 7800 for the year 2019. Inventoryequals to 7500 and 6800 respectively for the year 2020 and 2019. Accounts Payable for the year 2020 equals to11000 and 9000 for the year 2019. (All numbers are in dollars)Please calculate cash conversion cycle?0137b)a)54o137647484O O O

Step 1 The cash conversion period (CCC) is a metric that measures how long it takes a business to…

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Business

Accounting

Please calculate cash conversion cycle?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 56P: The following selected information is taken from the financial statements of Arnn Company for its...

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Fava Company began operations in 2018 and used the LIFO inventory method for both financial reporting and income taxes. At the beginning of 2019, the anticipated cost trends in the industry had changed, so that it adopted the FIFO method for both financial reporting and income taxes. Fava reported revenues of 300,000 and 270,000 in 2019 and 2018, respectively. Fava reported expenses (excluding income tax expense) of 125,000 and 120,000 in 2019 and 2018, which included cost of goods sold of 55,000 and 45,000, respectively. An analysis indicates that the FIFO cost of goods sold would have been lower by 8,000 in 2018. The tax rate is 21%. Fava has a simple capital structure with 15,000 shares of common stock outstanding during 2018 and 2019. It paid no dividends in either year. Required: 1. Prepare the journal entry to reflect the change. 2. At the end of 2019, prepare the comparative income statements for 2019 and 2018. Notes to the financial statements are not necessary. 3. At the end of 2019, prepare the comparative retained earnings statements for 2019 and 2018.
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