CC1) La Sorpresa, S.A., a leading local company, knows that in order to know the rotations necessary to quantify its cash cycle, it is essential to apply some financial ratios. So how often it pays its suppliers, how often it rotates its inventories, and how often it charges its customers, will have to be calculated with the following data:
Total sales of the company..........................$4'586,109.47
Proportion of credit sales....................... 60%
Average customer balance............................. $ 343,958.21
Cost of sales ratio...................... 55%
Average inventory balance...................... $ 420,393.37
Average supplier balance................... $ 288,004.21
Beginning Inventory................................................ $ 385,554.55
The company spends about $8.125 million in operating cycle investments. With this data it is necessary to calculate:
1) The operating cycle.
2) The cash conversion cycle.
3) The cash turnover.
4) The minimum cash balance.
Note:
In the image, this is the original exercise, it is in Spanish, but it is easy to understand.
Very important Note:
It is necessary that you make a solution approach and then the result. Above all, to check the procedure and/or the formulas used, especially when you use excel.
please... understand the context of the exercise in Spanish, it is easy to understand.
Extracted text: CC1) La Sorpresa, S.A., empresa líder en la localidad, sabe que para conocer las rotaciones necesarias para cuantificar su ciclo de caja, es indispensable aplicar algunas razones financieras. Así que cada cuánto paga a sus proveedores, cada cuánto rotan sus inventarios, y cada cuánto cobra a sus clientes, habrá que calcularlo con los siguientes datos: Ventas totales de la empresa.. Proporción de ventas a crédito.. Saldo promedio de clientes.. Proporción del costo de ventas.. Saldo promedio de inventarios. Saldo promedio de proveedores.. Inventario Inicial.. .$4'586,109.47 60% $ 343,958.21 55% $ 420,393.37 $ 288,004.21 $ 385,554.55 La empresa gasta alrededor de $8.125 millones en inversiones del ciclo operativo. Con estos datos hay que calcular: 1) El ciclo operativo. 2) El ciclo de conversión de efectivo. 3) La rotación de caja. 4) El saldo mínimo de caja.