Problem 9-18A firm with sales of $21,000,000 has inventory of $1,800,000. The firm has no cash sales (all sales are on credit and are collected within 60days). You are willing to sell inventory to the firm on credit provided that you will be paid within 77 days. Should you sell to this firm on credit?Assume there are 365 days in a year. (This question is more subtle than it appears. Think through all the given information.) Round your answerto the nearest whole number.On average, it will take you31days to receive the payments, therefore, you should not vsell to the firm on credit.

Inventory Management -The oversight of a business's inventory, encompassing the manufacturing,…

firm with sales of $21,000,000 has inventory of $1,800,000. The firm has no cash sales (all sales are on credit and are collected within 60 ys). You are willing to sell inventory to the firm on credit provided that you will be paid within 77 days. Should you sell to this firm on credit? sume there are 365 days in a year. (This question is more subtle than it appears. Think through all the given information.) Round your answer the nearest whole number. sell to the firm on credit.

firm with sales of $21,000,000 has inventory of $1,800,000. The firm has no cash sales (all sales are on credit and are collected within 60 ys). You are willing to sell inventory to the firm on credit provided that you will be paid within 77 days. Should you sell to this firm on credit? sume there are 365 days in a year. (This question is more subtle than it appears. Think through all the given information.) Round your answer the nearest whole number. sell to the firm on credit.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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INFORMATIONThe following information was provided by Intel Enterprises:1. The bank balance on 31 December 2022 is expected to be R40 000 (unfavourable).2. Credit sales are expected to be as follows:December 2022 January 2023 February 2023R576 000 R540 000 R648 0003. Credit sales usually make up 40% of the total sales. Cash sales make up the balance. Cash customersreceive a 10% discount.4. Credit sales are normally collected as follows:* 30% in the month in which the transaction takes place, and these customers are entitled to a 5% discount.* 65% in the following monthThe rest is usually written off as bad debts.5. Budgeted purchases of inventory are as follows:December 2022 January 2023 February 2023R1 000 000 R800 000 R920 0006. Fifty percent (50%) of the purchases are for cash. The remainder is paid in the month after the purchase.7. The monthly salaries amount to R150 000. Salaries are expected to increase by 9% with…
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