See Table EB showing a. How did Mydeco\'s sta g financial statement data and sto
ID: 2808517 • Letter: S
Question
See Table EB showing a. How did Mydeco's sta g financial statement data and stock price d accounts receivable days change over this period? s inventory days change over this period? b. How did Mydeco' c. Based on your analysis, has Mydeco improved its managemont of ts working capital during this time period?(Note Use a 365-day year) a. How did Mydeco's accounts receivable days change over this period? The accounts receilvable days for 2012 idays (Round to one decimal place) The accounts receivable days for 2016 isdays. (Round to one decimal place.) b. How did Mydeco's ventory days change over this period? Inventory days for 2012 is days. (Round to one decimal place.) Inventory days for 2016 is days. (Round to one decimal place) c. Based on your analysis, has Mydeco improved its management of its working capital during this time period? (Select the best choice below) Between 2012 and 2016, Mydeco's working capital management was Sby botaccounts receivable days and inventary days.Explanation / Answer
Given that - 2012 2013 2014 2015 2016 a) Revenue 395.7 368.1 429.4 509.4 608.5 b) Cost of good sold 184.9 174.4 202.2 246.2 296.4 c) Account receivable 89.4 71.2 68.8 75.2 85.7 d) Inventory 35.2 31.7 27.5 33.3 34.8 e) Total current asset 173.1 172.6 194.4 192.7 208.2 f) account payable 17.7 17.5 22.4 28.1 30.4 g) Accrued compensation 7.3 5.6 7.1 7.9 9.1 h=f+g Current liabilities 25.0 23.1 29.5 36.0 39.5 Account receivable days =AR*365/sales 82.46 70.60 58.48 53.88 51.41 Inventory days =inventory*365/cost of goods sold 69.5 66.3 49.6 49.4 42.9 Working capital = Current asset - current liabilities 148.1 149.5 164.9 156.7 168.7 Answer a) Account receivable days in 2012 = 82.46 Account receivable days in 2016 = 51.41 Answer b) Inventory days in 2012 = 69.5 Inventory days in 2016 = 42.9 Answer c) Working capital has increased from 148.1 to 168.7 over the period, which is good for the company. This means company is better able to manage its working capital Between 2012 to 2016, Mydeco' s working capital management was improved by both managing account receivable days and inventory days.