FUND.ACCT.PRIN -ONLINE ONLY  >I<
FUND.ACCT.PRIN -ONLINE ONLY >I<
22nd Edition
ISBN: 9780077632878
Author: Wild
Publisher: MCG
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Chapter 19, Problem 9BTN

Apple and Samsung are competitors in the global marketplace. Apple's and Samsung's financial statements are in Appendix A.

Required

1. Determine the change in Apple's and Samsung's inventories for the most recent year reported. Then identify the impact on net resources generated by operating activities (increase or decrease) for the change in inventory level (increase or decrease) for Apple and Samsung for that same year.

2. How would the move to a just-in-time (JIT) system likely impact future operating cash flows and operating income'?

3. Would a move to a JIT system likely impact Apple more than it would Samsung? Explain.

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Hubble Space Incorporated has the following data which includes inventory conversion period or ICP of the firms against which it benchmarks. The firm's new manager is looking into the company on how he could reduce its inventory enough to reduce its ICP to the benchmarks' average. If this were done, by how much would inventories decrease? Assume a 365-day year. Cost of goods sold =P85,000; Inventory =P20,000; Inventory conversion period (ICP) =85.88; Benchmark inventory conversion period (ICP) =38.00 * P 7,316 P11,151 P 9,032 P10,036 O P 8,129
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