Finance Chapter 18 Q6 Icers Corporation Cash Cycle Operating Cycle

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Chapter 18 Q6
Consider the following financial statement for the XX Icers Corp.
	Item	Beginning		Ending
	Inventory	20,386		22,164
	Accounts Receivable	16,783		17,216
	Accounts Payable	17,099		17,561
	Net Sales		418,276
	Cost of Goods Sold		234,912
	All sales are received on credit
	Calculate the operating and cash cylces.
	Operating Cycle:
	Inventory Turnover	(Cost of Goods Sold / Average Inventory)
	Inventory Turnover	11.0416921	=D10/(AVERAGE(C6,E6))
	Inventory Period	(365/Inventory Turnover)
	Inventory Period	33.0565276	=365/C18
	Receivables Turnover	(Sales/Average Receivables)
	Receivables Turnover	24.6051943	=D9/AVERAGE(C7:E7)
	Receivables Period	(365/Receivables Turnover)
	Receivables Period	14.8342661	=365/C23
	Operating Cylce	(Inventory Period + Receivables Period)
	Operating Cylce	47.8907937	=C20+C25
	Cash Cylce:
	Payables Turnover	(Cost of Goods Sold / Average Payables)
	Payables Turnover	13.5552222	=D10/AVERAGE(C8:E8)
	Payables Period	(365/Payables Turnover)
	Payables Period	26.9268918	=365/C32
	Cash Cycle	Operating Cycle - Payables Turnover
	Cash Cycle	20.9639019	=C28-C34