Use the information for the question(s)below. Azamel Cosmetics specializes in cosmetics which have high levels of UV protection.The above figures show the anticipated sales over the next four quarters.Azamel carries inventory equal to 30% of next quarter's sales,has accounts payable of 20% of next quarter's sales,and accounts receivable of 25% of this quarter's sales.
-If its net income is 12% of sales,in which quarter(s)is it expected that Azamel's seasonal working capital needs will be the greatest?

Question

Use the information for the question(s)below.  Azamel Cosmetics specializes in cosmetics which have high levels of UV protection.The above figures show the anticipated sales over the next four quarters.Azamel carries inventory equal to 30% of next quarter's sales,has accounts payable of 20% of next quarter's sales,and accounts receivable of 25% of this quarter's sales.
-If its net income is 12% of sales,in which quarter(s)is it expected that Azamel's seasonal working capital needs will be the greatest?

Quizplus · Accepted Answer

Seasonal working capital needs are typically greatest in the quarter with the highest sales, as more inventory and receivables need to be financed.

Use the Information for the Question(s)below