Bundle: Financial & Managerial Accounting, Loose-leaf Version, 13th + CengageNOWv2, 1 term (6 months) Printed Access Card Corporate Financial ... Access Card for Managerial Accounting, 13th
13th Edition
ISBN: 9781305781429
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 7, Problem 7.25EX
Variation in
Mattel, Inc., designs, manufactures, and markets toy products worldwide. Mattel's toys include Barbie™ fashion dolls and accessories, Hot Wheels™, and Fisher-Price brands. For a recent year, Mattel reported the following net cash flows from operating activities (in thousands):
| First quarter ending March 30 | $ 171,506 |
| Second quarter ending June 29 | (232,557) |
| Third quarter ending September 29 | f40,l 09) |
| Fourth quarter ending December 30 | 986,778 |
Explain why Mattel reported negative net cash flows from operating activities during the second and third quarters and a large positive cash flow for the fourth quarter, with overall net positive cash flow for the year.
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Mattel, Inc., designs, manufactures, and markets toy products worldwide. Mattel's toys include
Barbie® fashion dolls and accessories, Hot Wheels®, and Fisher-Price brands. For a recent
year, Mattel reported the following net cash flows from operating activities (in thousands):
$ (53,110)
First quarter ending March 31
Second quarter ending June 30
Third quarter ending September 30
Fourth quarter ending December 31
(187,663)
18,435
956,895
Explain why Mattel reported negative net cash flows from operating activi-
ties during the first and second quarters and a large positive cash flow for the fourth
quarter, with overall net positive cash flow for the year.
Compute Cash Conversion Cycle for Competing Firms
Kellogg’s Company and General Mills compete in the consumer packaged goods (CPG) sector. Refer to the following 2018 financial data for the two companies to answer the requirements.
$ millions
K
GIS
Total revenue
$14,575.0
$16,768.0
Cost of sales and services
9,849.0
10,312.9
Average accounts receivable
1,382.0
2,585.0
Average inventory
2,302.0
1,562.9
Average accounts payable
2,348.0
3,461.0
Note: Complete the entire question in Excel and format each answer to two decimal places. Then enter the answers into the provided spaces below with two decimal places.
a. Compute the following measures for both companies.
1. Days sales outstanding (DSO)
Company
DSO
K
Answer
GIS
Answer
2. Days inventory outstanding (DIO)
Company
DIO
K
Answer
GIS
Answer
3. Days payable outstanding (DPO)
Company
DPO
K
Answer
GIS
Answer
4. Cash conversion cycle (CCC)
Company…
Question
Observe the following statement:
STATEMENT OF CASH FLOW FOR "COUCH POTATO TECHNOLOGIES P/L"
For the year ending June 30 2011
2010 2011
$000 $000
Receipts from customers (sales)
Payments for purchases
Payments to employees
Purchase of assets
350
180
50
60
80
80
10
20
Payments for operating expenses
10
15
Additional Information:
Industry Average Efficiency : 20%
Net profit in 2010 : $21 000
a) Define the term working capital.
b) Comment on the cash flow of Couch Potato Technologies P/L in 2010.
c) Calculate and comment on the efficiency of Couch Potato Technologies P/L
d) Calculate and comment on the net profit of Couch Potato Technologies P/L.
e) Recommend TWO strategies that can be used to manage the working capital of
Couch Potato Technologies P/L.
Chapter 7 Solutions
Bundle: Financial & Managerial Accounting, Loose-leaf Version, 13th + CengageNOWv2, 1 term (6 months) Printed Access Card Corporate Financial ... Access Card for Managerial Accounting, 13th
Ch. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 7.1APECh. 7 - Internal control elements Identify each of the...Ch. 7 - Prob. 7.2APECh. 7 - Prob. 7.2BPECh. 7 - Prob. 7.3APECh. 7 - Prob. 7.3BPECh. 7 - Prob. 7.4APECh. 7 - Prob. 7.4BPECh. 7 - Prob. 7.5APECh. 7 - Prob. 7.5BPECh. 7 - Sarbanes-Oxley internal control report Using...Ch. 7 - Prob. 7.2EXCh. 7 - Prob. 7.3EXCh. 7 - Prob. 7.4EXCh. 7 - Prob. 7.5EXCh. 7 - Prob. 7.6EXCh. 7 - Prob. 7.7EXCh. 7 - Prob. 7.8EXCh. 7 - Prob. 7.9EXCh. 7 - Prob. 7.10EXCh. 7 - Prob. 7.11EXCh. 7 - Prob. 7.12EXCh. 7 - Prob. 7.13EXCh. 7 - Prob. 7.14EXCh. 7 - Prob. 7.15EXCh. 7 - Prob. 7.16EXCh. 7 - Prob. 7.17EXCh. 7 - Prob. 7.18EXCh. 7 - Prob. 7.19EXCh. 7 - Prob. 7.20EXCh. 7 - Prob. 7.21EXCh. 7 - Prob. 7.22EXCh. 7 - Prob. 7.23EXCh. 7 - Prob. 7.24EXCh. 7 - Variation in cash flows Mattel, Inc., designs,...Ch. 7 - Prob. 7.26EXCh. 7 - Prob. 7.27EXCh. 7 - Prob. 7.28EXCh. 7 - Prob. 7.1APRCh. 7 - Prob. 7.2APRCh. 7 - Prob. 7.3APRCh. 7 - Prob. 7.4APRCh. 7 - Prob. 7.5APRCh. 7 - Prob. 7.1BPRCh. 7 - Prob. 7.2BPRCh. 7 - Prob. 7.3BPRCh. 7 - Prob. 7.4BPRCh. 7 - Prob. 7.5BPRCh. 7 - Ethics and professional conduct in business During...Ch. 7 - Prob. 7.2CPCh. 7 - Prob. 7.3CPCh. 7 - Prob. 7.4CPCh. 7 - Prob. 7.5CPCh. 7 - Prob. 7.7CP
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