Work... work... working capital
A company has Current Assets for $1.5 million and Short-Term Liabilities for $900K. What would their Net Working Capital be?
$600 K
A company has an Average Inventory Conversion Period of 40 days, a Payables Deferral Period of 50 days and an Average Collection Period of 20 days. What would its Operating Cycle be?
60 days.
In theory, when NWC increases, cash...
Decreases.
What is the name of the capital of Peru?
You have 20 seconds...
Lima
If I calculate the NPV of a project that offers earnings for my company and the result of this calculation is negative, what would be the incorrect decision?
To accept the project.
A company has Net Working Capital for $565,000 and Short-Term Liabilities for $700,000. How much does it have in Current Assets?
$1,265,000
A company has an Average Inventory Conversion Period of 40 days, a Payables Deferral Period of 50 days and an Average Collection Period of 20 days. What would its Cash Conversion Cycle be?
10 días.
In theory, that NWC decreases could be due to any of the following, EXCEPT:
a) You sold more
b) You asked for a loan
c) Your clients owe you more
c) Your clients owe you more.
What was the name and species of the first live being orbiting the Earth?
You have 20 seconds.
A Soviet dog named Laika.
My company has to pay 15% annually to finance our projects. A project offers an IRR of 17%, what would be the incorrect decision?
To reject the project.
The company for whom you work has Current Assets for $999,999 and Net Working Capital for $123,456. How much does it have in Short-Term Liabilities?
$876,543
A company has an Operation Cycle of 55 days. Its Payables Deferral Period of 20 days and its Inventory Conversion period is 40 days. What would its Cash Conversion Cycle be?
35 días.
In theory, the consequence of an increment in NWC of the company will cause that the profitability of the company ___.
Decreases.
What is the name and last name of your teachers of Module 1, Module 2 and Challenge?
Queta Martínez, Sandra Gómez and Hugo Ochoa.
In a hypothetical company, the cost of stock is 16% and the bank asks for a 16% interest rate. If they have to choose only one of these two options, knowing that the company pays 30% of taxes, what would be the incorrect decision and why?
Choosing to finance with money from their investors, because by using the bank loan, they can save taxes.
A company has Cash for $300,000 and their clients owe them $400,000. If they have THE SAME AMOUNT of Short-Term Liabilities and Net Working Capital of $600,000 each, how much will they have in Inventories?
$500,000
A company has an Operation Cycle of 65 days. Its Payables Deferral Period of 20 days and its Inventory Conversion period is 40 days. What would its Average Collection Period be?
45 días.
In theory, the risk of insolvency tends to be lower when the NWC ____.
Increases.
What is the name and nationality of the author of the painting named "Guernica". 50 extra points if you tell me in which Museum you can find this painting.
You have 20 seconds.
Pablo Picasso, Spanish painter. The work is in display at the Museo Reina Sofía in Madrid.
A company has to choose between two projects. One has a NPV of $3,500 and the other has an NPV of $5,000. What would be the incorrect decision?
Choosing the one with the $3,500 NPV.
The Current Assets of the company where you work at are divided in equal parts of Cash, Accounts Receivable and Inventories. The company owes $900,000 to their suppliers and the Net Working Capital is HALF of the Short-Term Liabilites. How much will the company have of Inventories?
$450,000
A company has an Operation Cycle of 60 days and a Cash Conversion Cycle of 40 days. How many days must the Inventory Conversion Period be reduced for the CCC to be exactly the same as its Payables Deferral Period?
20 días.
In theory, a large CCC means that the Minimum Cash required to operate will be ____.
high.
What is the name of the first woman to win a Nobel Prize?
Madame Marie Curie. She was, also, the first person to ever win two Nobel Prizes in two different fields (Physics in 1903, Chemistry in 1911)
A business person has to decide between two possibilities: investing in a project of their company that has an IRR of 15%, or a portfolio of investment with a return of 19%. Which would be the incorrect decision?
Investing in the company.