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The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Net sales Cost of sales Liabilities and Equity Earnings before taxes Taxes Earnings after taxes (net income) Accounts payable*** Accrued liabilities Selling, general, and administrative expenses Other expenses Total expenses (salaries and benefits) Other current liabilities **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Total current liabilities Long-term debt and other liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and equity Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days

The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Net sales Cost of sales Liabilities and Equity Earnings before taxes Taxes Earnings after taxes (net income) Accounts payable*** Accrued liabilities Selling, general, and administrative expenses Other expenses Total expenses (salaries and benefits) Other current liabilities **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Total current liabilities Long-term debt and other liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and equity Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter15: Financial Statement Analysis
Section: Chapter Questions
Problem 50E: Juroe Company provided the following income statement for last year: Juroes balance sheet as of...
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The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Liabilities and Equity Accounts payable****** Accrued liabilities (salaries and benefits) Other current liabilities Total current liabilities Long-term debt and other liabilities Earnings before taxes Taxes Earnings after taxes (net income) Common stock Retained earnings Net sales Cost of sales Selling, general, and administrative expenses Other expenses Total expenses Total stockholders' equity Total liabilities and equity **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days
Transcribed Image Text:The Butler-Huron Company's balance sheet and income statement for last year are as follows: Balance Sheet (in Millions of Dollars) Assets Cash and marketable securities Accounts receivable* Inventories** Other current assets Total current assets Plant and equipment (net) Other assets Total assets $82 820 1,507 22 $2,431 3,967 6,460 $6,460 Liabilities and Equity Accounts payable****** Accrued liabilities (salaries and benefits) Other current liabilities Total current liabilities Long-term debt and other liabilities Earnings before taxes Taxes Earnings after taxes (net income) Common stock Retained earnings Net sales Cost of sales Selling, general, and administrative expenses Other expenses Total expenses Total stockholders' equity Total liabilities and equity **Assume that average inventory over the year was the same as ending inventory. ***Assume that average accounts payable are the same as ending accounts payable. Income Statement (in Millions of Dollars) *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable. $13,599 10,512 1,828 701 $13,041 558 223 $335 $869 696 296 $1,861 2,719 159 1,721 $1,880 $6,460 Assume that there are 365 days per year. a. Determine Butler-Huron's cash conversion cycle. Round intermediate calculations and answer to one decimal place. days b. Determine Butler-Huron's cash conversion cycle assuming that 65 percent of annual sales are credit sales (that is, 35% represent cash sales). Round intermediate calculations and answer to one decimal place. days c. Determine Butler-Huron's cash conversion cycle assuming that 40 percent of annual sales are credit sales. Round intermediate calculations and answer to one decimal place. days
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