Question: Both Sun Microsystems Inc. and Cisco Systems are in the computer industry. These data (in millions) are from the end of their fiscal years 2009:

Both Sun Microsystems Inc. and Cisco Systems are in the computer industry. These data (in millions) are from the end of their fiscal years 2009:

Sun Cisco 675 (161) S1,027 Accounts payable Cost of goods sold Increase

Compare the payables turnover and days’ payable for both companies. How are cash flows affected by days’ payable? How do Sun Microsystems’ and Cisco Systems’ ratios compare with the computer industry ratios shown on pages 365 and 366? (Use year-end amounts for ratios.)

Sun Cisco 675 (161) S1,027 Accounts payable Cost of goods sold Increase (decrease) in inventory 6,718 13,023 (114)

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