The Brenmar Sales Company had a gross profit margin​ (gross profits÷​sales) of 34 percent and sales of $9.2 million last year.   73 percent of the​ firm's sales

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter3: Evaluation Of Financial Performance
Section: Chapter Questions
Problem 8P
icon
Related questions
Question

The Brenmar Sales Company had a gross profit margin​ (gross

profits÷​sales)

of

34

percent and sales of

$9.2

million last year.  

73

percent of the​ firm's sales are on​ credit, and the remainder are cash sales. ​ Brenmar's current assets equal

$1.2

​million, its current liabilities equal

$300,700​,

and it has

$109,000

in cash plus marketable securities.

 

a. If​ Brenmar's accounts receivable equal
$562,900​,
what is its average collection​ period?
b. If Brenmar reduces its average collection period to
25
​days, what will be its new level of accounts​ receivable?
c.  ​Brenmar's inventory turnover ratio is
9.3
times. What is the level of​ Brenmar's inventories?
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Income Statement Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Financial Management (MindTap Course…
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage