A company currently has a 51 day cash cycle. Assume the firm changes its operations such that it decreases its receivables period by 2 days,

A company currently has a 51 day cash cycle. Assume the firm changes its operations such that it decreases its receivables period by 2 days, increases its inventory period by 3 days, and increases its payables period by 4 days. What will the length of the cash cycle be after these changes?    A.  42 days B.  45 days C.  48 days D.  49 days E.  51 days Cash cycle = 51 - 2 + 3 - 4 = 48 days

74.

Tall Guys Clothing has a 45 day collection period. Sales for the next calendar year are estimated at $2,100, $1,600, $2,500 and $2,300, respectively, by quarter, starting with the first quarter of the year. Given this information, which one of the following statements is correct? Assume a year has 360 days.    A.  The firm will collect $800 in Quarter 2. B.  The accounts receivable balance at the beginning of Quarter 4 will be $1,150. C.  The firm will collect $2,000 in Quarter 3. D.  The firm will have an accounts receivable balance of $2,300 at the end of the year. E.  The firm will collect a total of $2,400 in Quarter 4. Q4 collections = 45/90 ($2,500) + 45/90 ($2,300) = $2,400

75.

Forest Gardens, Inc., has a beginning receivables balance on February 1 of $730. Sales for February through May are $720, $780, $820, and $850, respectively. The accounts receivable period is 30 days. What is the amount of the April collections? Assume a year has 360 days.    A.  $720 B.  $780 C.  $790 D.  $820 E.  $850 In April, the firm would collect March sales of $780.