Finance Ch. 12

Davis Supply maintains an average inventory of 2,000 dinosaur skulls for sale to filmmakers. The carrying cost per skull per year is estimated to be $150.00 and the fixed order cost is $56. What is the economic order quantity (EOQ)? (Round to the nearest whole number.)

39

Gillstrap Promotions has projected the following values for the next three months: January February March Sales $352,000 $379,000 $405,569 Purchases Credit $218,000$240,000$260,000 on Trade Cash Expenses$88,000$91,000$94,000 Taxes, interest, and dividends$18,000$20,000$41,000 Capital $50,000 0 $25,000 Expenditures

-13,072.4

Libscomb Technologies' annual sales are $6,708,456 and all sales are made on credit, it purchases $3,422,149 of materials each year (and this is its cost of goods sold). Libscomb also has $534,802 of inventory, $561,152 of accounts receivable, and $439,946 of accounts payable. Assume a 365 day year. What is Libscomb's Receivables Turnover?

11.95

Mahrouq Technologies buys $12,726,823 of materials (net of discounts) on terms of 1/30, net 60, and it currently pays within 30 days and takes discounts. Mahrouq plans to expand, and this will require additional financing. If Mahrouq decides to forego discounts and thus to obtain additional credit from its suppliers, calculate the nominal cost of that credit. Answer in % terms to 2 decimal places (no % sign).

12.29

Mavericks Cosmetics buys $3,663,775 of product (net of discounts) on terms of 3/10, net 60, and it currently pays on the 10th day and takes discounts. Mavericks plans to expand, and this will require additional financing. If Mavericks decides to forego discounts, what would the effective percentage cost of its trade credit be, based on a 365-day year? Answer in % terms to 2 decimal places.

203.97

Hammond Supplies expects sales of 203,965 units per year with carrying costs of $4.79 per unit and ordering cost of $5.02 per order. Assuming the level of inventory is stable, what is the optimal average number of units in inventory? Round to the nearest whole number.

327

Carlisle Transport had $4,802 cash at the beginning of the period. During the period, the firm collected $1,765 in receivables, paid $1,857 to supplier, had credit sales of $5,512, and incurred cash expenses of $500. What was the cash balance at the end of the period?

4,210

Libscomb Technologies' annual sales are $5,869,931 and all sales are made on credit, it purchases $3,049,748 of materials each year (and this is its cost of goods sold). Libscomb also has $530,410 of inventory, $516,988 of accounts receivable, and $467,130 of accounts payable. Assume a 365 day year. What is Libscomb's Inventory Turnover?

5.75

Libscomb Technologies' annual sales are $5,213,233 and all sales are made on credit, it purchases $3,344,351 of materials each year (and this is its cost of goods sold). Libscomb also has $547,885 of inventory, $561,899 of accounts receivable, and beginning and ending of year $419,257 and $401,254 accounts payables (respectively). Assume a 365 day year. What is Libscomb's Cash Cycle (in days)?

54.36

Libscomb Technologies' annual sales are $6,363,107 and all sales are made on credit, it purchases $3,141,646 of materials each year (and this is its cost of goods sold). Libscomb also has $523,201 of inventory, $521,465 of accounts receivable, and $453,662 of accounts payable. Assume a 365 day year. What is Libscomb's Inventory Period (in days)?

60.79

Libscomb Technologies' annual sales are $5,318,234 and all sales are made on credit, it purchases $3,637,187 of materials each year (and this is its cost of goods sold). Libscomb also has $507,386 of inventory, $516,502 of accounts receivable, and $481,098 of accounts payable. Assume a 365 day year. What is Libscomb's Operating Cycle (in days)?

86.37

Libscomb Technologies' annual sales are $5,501,383 and all sales are made on credit, it purchases $3,040,402 of materials each year (and this is its cost of goods sold). Libscomb also has $505,754 of inventory, $1,475,000 of accounts receivable, and $1,400,000 of accounts payable. Assume a 365 day year. What is Libscomb's Receivables Period (in days)?

97.87