Emile Gonzalez – Dec 2012 – Q3 – internal finance resources

This topic has 1 reply, 2 voices, and was last updated 10 years ago by Ken Garrett.

Viewing 2 posts - 1 through 2 (of 2 total)

Author

Posts
March 7, 2016 at 5:25 pm #304116
mini
Member
- Topics: 38
- Replies: 27
Dear Sir,

in the question Emile Gonzalez, trade receivable days were calculated as following: (260/1,600) x 365= 59 and it says that reducing trade receivable days to 30 days would release about $128,500. Could you please advise how $128,500 is calculated?

Thank you in advance
March 7, 2016 at 7:29 pm #304210
Ken Garrett
Keymaster
- Topics: 10
- Replies: 10661
260 represents 59.3125 days of receivables

Lowering the collection period from 59.3125 to 30 days ( a reduction of 29.3125) will lower receivables by 260 x 29.3125/59.3125 = 128.5.
Author

Posts

Viewing 2 posts - 1 through 2 (of 2 total)

You must be logged in to reply to this topic.