The income statement and end-of-year balance sheet of Altar Inc., a distribution company, are as follows: Income

Question:

The income statement and end-of-year balance sheet of Altar Inc., a distribution company, are as follows:

Income Statement

Net sales………………………………………………….......…… $2,000,000

Cost of goods sold………………………………………...…… 1,300,000

Selling, general, and administrative expenses…….. 300,000

Depreciation expense…………………………...............… 100,000

Earnings before interest and tax………………….....… 300,000

Net interest expense………………………............……… 20,000

Earnings before tax………………………….............…… 280,000

Income tax expense…………………………...........……… 50,000

Earnings after tax…………………….................……… $ 230,000

Balance Sheet

Cash…………………………………………… $ 100,000

Accounts receivable……………………………… 500,000

Inventories¹ ………………………………… 400,000

Other current assets …………………………… 300,000

Noncurrent assets……………………………… 500,000

Total assets …………………………………… $1,800,000

Short-term debt…………………………………… $ 100,000

Accounts payable…………………………… 600,000

Accrued expenses……………………………… 400,000

Long-term debt…………………………………… 300,000

Owners’ equity…………………………………… 400,000

Total liabilities and owners’ equity…………….. $1,800,000

What is the cash-to-cash conversion period of Altar Inc. at the end of the year?

Balance Sheet
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