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Marshall Inc. recently hired your consulting firm to improve the company's performance. It has been highly...

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Finance

Marshall Inc. recently hired your consulting firm to improve thecompany's performance. It has been highly profitable but has beenexperiencing cash shortages due to its high growth rate. As onepart of your analysis, you want to determine the firm's cashconversion cycle. Using the following information and a 365 dayyear, what is the firm's present cash conversion cycle? Enter youranswer rounded to two decimal places. For example, if your answeris 123.45% or 1.2345 then enter as 1.23 in the answer box.

Average Inventory = $80,000.00

Annual Sales = $650,000.00

Annual Cost of Goods Sold = $395,000.00

Average Accounts Receivable = $170,000.00

Average Accounts Payable = $30,000.00

Answer & Explanation Solved by verified expert
4.2 Ratings (613 Votes)
Inventory turnover COGSinventory Inventory turnover 39500080000 Inventory turnover 494 days of inventory on hand number of days in a yearinventory turnover days of inventory on hand 365494    See Answer
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Transcribed Image Text

Marshall Inc. recently hired your consulting firm to improve thecompany's performance. It has been highly profitable but has beenexperiencing cash shortages due to its high growth rate. As onepart of your analysis, you want to determine the firm's cashconversion cycle. Using the following information and a 365 dayyear, what is the firm's present cash conversion cycle? Enter youranswer rounded to two decimal places. For example, if your answeris 123.45% or 1.2345 then enter as 1.23 in the answer box.Average Inventory = $80,000.00Annual Sales = $650,000.00Annual Cost of Goods Sold = $395,000.00Average Accounts Receivable = $170,000.00Average Accounts Payable = $30,000.00

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