Question: Rex Ltd. decided to increase its bill payment time from 20 days to 40 days. It was said that they wanted to exercise some cost

Rex Ltd. decided to increase its bill payment time from 20 days to 40 days. It was said that they wanted to exercise some cost control and optimize cash flow. i) What impact will this have on Rexs operating and cash cycles? ii) How will Rexs suppliers be affected? iii) Is what Rex did ethical to do, especially with short suppliers? iv) Is there any cash benefit to Rex from the decision?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Question 1 - Total 15 marks a) In the real world, why will a firm not seek to take unlimited advantage of the interest tax shield? Explain your reasoning. ( 5 marks) b) A firm shares the following...

Trump Ltd. decided to increase its bill payment time from 20 days to 40 days. It was said that they wanted to exercise some cost control and optimize cash flow. i) What impact will this have on...

What will be the answer for the following scenario? Trump Ltd. decided to increase its bill payment time from 20 days to 40 days. It was said that they wanted to exercise some cost control and...

Trump Ltd. decided to increase its bill payment time from 20 days to 40 days. It was said that they wanted to exercise some cost control and optimize cash flow. i) What impact will this have on...

28 Beram Corp issued a $70.000, ten year bond at the face rate of 0% pamut How much cash wine bondedor the end of the first rest pros? Select one A $2.000 51,200 C. 51.000 5800 On 29 Below are some...

The Brick Wall - Case Study 9.1 Scenario: It is now time to reexamine the brick wall example from this chapter. That example must be referred to while addressing this case study. It is now the end of...

1. From the scenario, cite your forecasting conclusions that support TFC?s decision to expand to the West Coast market. Speculate as to whether or not the agency conflict discussed in the scenario...

FIN201 Final Exam Sample MULTIPLE CHOICE. 1. Why will banks permit the use of an overdraft as suitable for funding the purchase of inventory that will quickly be converted into cash? A. To assist a...

How are the changes that Taco Bell implemented, such as K-minus, SOS, etc., similar to, or different from, the various concepts/techniques that were presented in weeks 1-8 in this module. Provide a...

From the following transactions, open the relevant ledger accounts. 1/1/2010 Sold goods on credit for Kshs. 15,000/=. 2/1/2010 Bought goods on credit for Kshs. 5,000/=. 3/1/2010 Paid creditors Kshs....

Two forces have the same magnitude F. What is the angle between the two vectors if their sum bas a magnitude of (a) 2F? (b) 2F? (c) zero? Sketch the three vectors in each case.

Katlyn needs to irvest $ 5 , 3 1 8 today for her savings account to be worth $ 8 , 0 0 0 sbx years from now. Which one of the following terms refers to the $ 5 , 3 1 8 ? Maltple Choice Future value...

The first scenario will be a Verbal Judo scenario in which your scenario follows the standard Verbal Judo interaction: You need to ask somebody to modify their behavior either to do something or to...

1-10 Visit a job-posting Web site such as Monster.com. Spend some time at the site examining jobs for accounting, finance, sales, marketing, and human resources. Find two or three descriptions of...

1-1 How are information systems transforming business, and why are they so essential for running and managing a business today? Describe how information systems have changed the way businesses...

4. What would happen if UPSs information systems were not available? United Parcel Service (UPS) started out in 1907 in a closet-sized basement office. Jim Casey and Claude Ryantwo teenagers from...