The normal credit terms Jonas Company gives are Net 45.The normal terms it is given by...

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Finance

The normal credit terms Jonas Company gives are Net 45.Thenormal terms it is given by its suppliers is Net 30.Its goal is tomantain 40 days of delivery on hand.
The following information is given by Jonas Company (seeattached photo) at the most recent quarter end.The balance sheetaccounts have been relatively unchanged over the past threemonths:

Inventory $250,650
Accounts Receivable. $525,000
Accounts payable. $136,250
Sales (for the quarter) $980,000
Cost of Goods Sold (for the quarter) $528,000

Part 1.Calculate the following cycles (in days to two decimalplaces)

A.Accounts payable period
B.Accounts recieveable period
C.Cash cycle
D.Inventory period
E.Operating cycle

2.Comment on whether Jonas Company is managing their workingcapital well.What might they do to improve their working capitalmanagement?

Answer & Explanation Solved by verified expert

3.6 Ratings (539 Votes)

A Accounts Payable Period 365 Accounts PayableCost of Goods Sold 365 136250528000 14 since COGS is for the quarter 2355 days B Accounts receivable period 365 Accounts ReceivableSales 365 525000980000 14Since Sales is for the quarter 4888 days D See Answer

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The normal credit terms Jonas Company gives are Net 45.Thenormal terms it is given by its suppliers is Net 30.Its goal is tomantain 40 days of delivery on hand.The following information is given by Jonas Company (seeattached photo) at the most recent quarter end.The balance sheetaccounts have been relatively unchanged over the past threemonths:Inventory $250,650Accounts Receivable. $525,000Accounts payable. $136,250Sales (for the quarter) $980,000Cost of Goods Sold (for the quarter) $528,000Part 1.Calculate the following cycles (in days to two decimalplaces)A.Accounts payable periodB.Accounts recieveable periodC.Cash cycleD.Inventory periodE.Operating cycle2.Comment on whether Jonas Company is managing their workingcapital well.What might they do to improve their working capitalmanagement?