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Homework answers / question archive / 1)In December 2015, Apple had cash of $37

1)In December 2015, Apple had cash of $37

Finance

1)In December 2015, Apple had cash of $37.87 billion, current assets of $76.68 billion, and current liabilities of $75.79 billion. It also had inventories of $2.45 billion. a. What was Apple's current ratio? b. What was Apple's quick ratio? c. In January 2016, Hewlett-Packard had a quick ratio of 0.66 and a current ratio of 0.90. What can you say about the asset liquidity of Apple relative to Hewlett-Packard? a. What was Apple's current ratio? Apple's current ratio was.

2)JPJ Corp has sales of $1.46 million, accounts receivable of $49,000, total assets of $5.21 million (of which $3.15 million are fixed assets), inventory of $148,000, and cost of goods sold of $600,000. What is JPJ's accounts receivable days? Fixed asset turnover? Total asset turnover? Inventory turnover? What is JPJ's accounts receivable days? JPJ's accounts receivable days are days.

3) A relevant cash flow can best be described as... a cash flow that is generated from a sale but not from a cost. The difference between a firm's future cash flow with and without the project. the difference between a firms accounting profit and depreciation. any cash flow of the firm. QUESTION 2 Which of the following cash flows are not relevant to analysing a project? O side-effects opportunity cost financing costs normal cash flow item.

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1)

CURRENT RATIO = CURRENT ASSET/CURRENT LIABILITY
           
CA 76.68 $ MIILION    
CL 75.79 $ MIILION    
           
CR = 76.68      
    75.79      
           
CR 1.01        
           

B. Quick ratio is calculated by dividing liquid current assets by total current liabilities. Liquid current assets include cash, marketable securities and receivables.

QUICK RATIO = Cash+Marketable Securities+ Receivables  
      CURRENT LIABILITY  

OR

QUICK RATIO = CURRENT ASSET- INVENTORIES- PREPAYMENT  
      CURRENT LIABILITY  
CA   76.68 $ MIILION
CL   75.79 $ MIILION
CASH   37.87 $ MIILION
INVENTORIES   2.45 $ MIILION
       
       
QUICK RATIO = (76.68-2.45)/75.79  
       
       
QUICK RATIO = 0.98  

2)

Sales (in Mn $)

1.46

Account receivable (in $)

49,000.00

Total Assets (in Mn $)

5.21

Fixed assets (in Mn $)

3.15

Inventory (in $)

148,000.00

Cost of goods sold (in $)

600,000.00

Accounts receivable days = Accounts receivable / Sales x no. of days

Accounts receivable days = 49000 / 1460000 x 365

Accounts receivable days = 12.25 days

Fixed asset turnover = Sales / Fixed Assets

Fixed asset turnover = 1460000 / 3150000

Fixed asset turnover = 0.46

Total asset turnover = Sales / Total assets

Total asset turnover = 1460000 / 5210000

Total asset turnover = 0.28

Inventory turnover = Cost of goods sold / Inventory

Inventory turnover = 600000 / 148000

Inventory turnover = 4.05

 

3)

1. Option, the difference between a firm's future cash flow with and without the project [ Incremental cash flows are relevant while judging a project]

2. Option, financing costs [ Financing costs are not relevant while considering cash flows]

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