In the current financial year, a company was having an average collectibles period of 630 days and an inventory conversion period of 900 days. Its sales for the year stood at 700 and cost of goods sold stood at 720. The balance sheet for the Current Year showed the accounts receivables to be 1500 and inventory to be 1000.

Based on the above, answer the following:

1. The company would probably be from ___________ industry.

(a) Agriculture Processing

(b) Mineral Water

(c) Ship Building Industry

(d) Airline Industry

2. One can say that:

(a) In the Current Year, the company changed its credit policies (with customers) and inventory policies

(b) Manipulated its accounts

(c) Both (a) and (b)

(d) Can’t say

3. Given the above information, we can say that for Previous Year:

(a) Receivables was less than Current Year; Inventory was less than Current Year

(b) Receivables was more than Current Year; Inventory was more than Current Year

(c) Receivables was less than Current Year; Inventory was more than Current Year

(d) Receivables was more than Current Year; Inventory was less than Current Year

(e) Can’t say