Refer to the Financial Statements for Wal-Mart, BelowB Working Capital Management Is an Important Consideration for Many

The Answer of Refer to the Financial Statements for Wal-Mart, BelowB Working Capital Management Is an Important Consideration for Many

Refer to the Financial Statements for Wal-Mart, BelowB Working Capital Management Is an Important Consideration for Many

The Answer of Refer to the Financial Statements for Wal-Mart, BelowB Working Capital Management Is an Important Consideration for Many

Solved

Refer to the Financial Statements for Wal-Mart, Below

question 51

Essay

Refer to the financial statements for Wal-Mart, below
$Refer to the financial statements for Wal-Mart, below a. Calculate for X7 the ratios listed below. X6 numbers are provided for comparative purposes. \begin{array}{lr} &X6&X7\\ \text { Inventory turnover } & 4.96 \\ \text { Days' inventory outstanding } & 77.20 \\ \text { Accounts receivable turnover } & 120.58 \\ \text { Days' receivable outstanding } & 3.28 \\ \text { Payables turnover } & 12.39 \\ \text { Days' payables outstanding } & 31.10 \\ \text { Length of operating cycle } & 80.48 \\ \text { Length of cash cycle } & 49.37 \\ \text { Current ratio } & 1.51 \\ \text { Quick ratio } & 0.12 \end{array} b. Working capital management is an important consideration for many companies. Which component of Wal-Mart's working capital do you think it spends most time managing? That is, which component is likely to be the most important? Why? What has happened to this component from X6 to X7? Note: Use ending inventory, ending accounts receivable, and ending accounts payable in the calculation of days' inventory outstanding, days' receivable outstanding, and days' payables outstanding respectively. Use average inventory, average accounts receivable, and average accounts payable in the calculation of inventory turnover, accounts receivable turnover, and payables turnover respectively.$
$Refer to the financial statements for Wal-Mart, below a. Calculate for X7 the ratios listed below. X6 numbers are provided for comparative purposes. \begin{array}{lr} &X6&X7\\ \text { Inventory turnover } & 4.96 \\ \text { Days' inventory outstanding } & 77.20 \\ \text { Accounts receivable turnover } & 120.58 \\ \text { Days' receivable outstanding } & 3.28 \\ \text { Payables turnover } & 12.39 \\ \text { Days' payables outstanding } & 31.10 \\ \text { Length of operating cycle } & 80.48 \\ \text { Length of cash cycle } & 49.37 \\ \text { Current ratio } & 1.51 \\ \text { Quick ratio } & 0.12 \end{array} b. Working capital management is an important consideration for many companies. Which component of Wal-Mart's working capital do you think it spends most time managing? That is, which component is likely to be the most important? Why? What has happened to this component from X6 to X7? Note: Use ending inventory, ending accounts receivable, and ending accounts payable in the calculation of days' inventory outstanding, days' receivable outstanding, and days' payables outstanding respectively. Use average inventory, average accounts receivable, and average accounts payable in the calculation of inventory turnover, accounts receivable turnover, and payables turnover respectively.$
a. Calculate for X7 the ratios listed below. X6 numbers are provided for comparative purposes.
$\begin{array}{lr}&X6&X7\\\text { Inventory turnover } & 4.96 \\\text { Days' inventory outstanding } & 77.20 \\\text { Accounts receivable turnover } & 120.58 \\\text { Days' receivable outstanding } & 3.28 \\\text { Payables turnover } & 12.39 \\\text { Days' payables outstanding } & 31.10 \\\text { Length of operating cycle } & 80.48 \\\text { Length of cash cycle } & 49.37 \\\text { Current ratio } & 1.51 \\\text { Quick ratio } & 0.12\end{array}$
b. Working capital management is an important consideration for many companies. Which component of Wal-Mart's working capital do you think it spends most time managing? That is, which component is likely to be the most important? Why? What has happened to this component from X6 to X7?
Note: Use ending inventory, ending accounts receivable, and ending accounts payable in the calculation of days' inventory outstanding, days' receivable outstanding, and days' payables outstanding respectively. Use average inventory, average accounts receivable, and average accounts payable in the calculation of inventory turnover, accounts receivable turnover, and payables turnover respectively.

Definitions:

Property Rights

Legal rights to possess, use, and dispose of assets including real estate, intellectual property, or other possessions.

Negatively Affects

Causes a decrease in effectiveness, quality, or function.

Air Traffic

The movement of aircraft within the airspace system, and the operational procedures, technical infrastructure, and personnel that control and manage it.

Property Rights

Legal rights to possess, use, and dispose of assets including real estate, intellectual property, and other possessions.