Working capital question
annual sales 12,000,000
gross profit margin 10%
purchase equates to 90% of cogs
terms extended by company to customers are wire in advance (COD)(money is due and sent prior to shipment)
Company turn over it's inventory 5 times per year
teams extended by suppliers are 1/10/45; permit payment 45 days company's
cost of capital is 7%
calculate the investment amount required for working capital needs
| area | avg daily | days invested | w/c needed |
| INV | 29,588 | 73 | 2,159,924 |
| AR | 32,876 | ? | ? |
| AP | 26,629 | (75) | (1,997,175) |
I cant figure out Account receivalbe
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Working capital question annual sales 12,000,000 gross profit margin 10% purchase equates to 90% of cogs...