Please Refer to Table 4-7 for the Following Question

question 17

Essay

Please refer to Table 4-7 for the following question.
Table 4-7
Hokie Corporation Comparative Balance Sheet
For the Years Ending December 31, 2009 and 2010
(Millions of Dollars)
Hokie had net income of $28 million for 2010 and paid total cash dividends of $20 million to their common stockholders.
-Certainty Corp.had total sales of $1,200,000 in 2010 (80 percent of its sales are credit).The company's gross profit margin is 25 percent,its ending inventory is $150,000,and its accounts receivable balance is $90,000.What additional amount of cash could the firm have generated if it had increased its inventory turnover ratio to 9.0 and reduced its average collection period to 28.21875 days?

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Definitions:

Financial Responsibility

Financial responsibility entails managing finances through prudent budgeting, saving, investing, and making informed financial decisions to ensure stability and growth of personal or business wealth.

Syndicate Sells

Occurs when a group of investment banks work together to sell a large issue of securities to the public or to institutional investors.

Venture Capital

A form of private equity financing provided by investors to startups and small businesses with strong growth potential in exchange for equity, or an ownership stake.

High-risk Project

A project that carries a greater-than-average chance of failing to meet its goals or losing the invested capital due to various uncertainties.