Suppose your firm receives a $5.82 million order on the last day of the year. You fill the order with $1.97 million worth of inventory. The customer picks up the entire order the same day and pays $1.09 million up front in cash; you also issue a bill for the customer to pay the remaining balance of $4.73 million within 40 days. Suppose your firm's tax rate is 0% (i.e., ignore taxes). Determine the consequences of this transaction for each of the following:a. Revenuesb. Earningsc. Receivablesd. Inventorye. Cash a. RevenuesRevenues will ▼ increase or decrease by $___ million. (Select from the drop-down menu and round to two decimal places.) Suppose your firm receives a $5.82 million order on the last day of the year. You fill the order with $1.97 million worth of inventory. The customer picks up the entireorder the same day and pays $1.09 million up front in cash; you also issue a bill for the customer to pay the remaining balance of $4.73 million within 40 days.Suppose your firm's tax rate is 0% (i.e., ignore taxes). Determine the consequences of this transaction for each of the following:a. Revenuesb. Earningsc. Receivablesd. Inventorye. Casha. RevenuesRevenues willby $million. (Select from the drop-down menu and round to two decimal places.)

Answered: Suppose your firm receives a $5.82…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2MC

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Suppose your firm receives a $5.82 million order on the last day of the year. You fill the order with $1.97 million worth of inventory. The customer picks up the entire order the same day and pays $1.09 million up front in cash; you also issue a bill for the customer to pay the remaining balance of $4.73 million within 40 days. Suppose your firm's tax rate is 0% (i.e., ignore taxes). Determine the consequences of this transaction for each of the following: a. Revenues b. Earnings c. Receivables d. Inventory e. Cash a. Revenues Revenues will ▼ increase or decrease by $___ million. (Select from the drop-down menu and round to two decimal places.)

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The sales value is calculated by multiplying the units sold equal to income, which is determined by multiplying the average sales price by the units sold. Receivables, also known as accounts receivable, are consumer debts owed to a business for products or services provided but not yet paid for. The term inventory relates to both raw materials in the manufacture and finished goods that are fully prepared for sale.

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