Financial Accounting: An Integrated Statements Approach, 2nd Edition

In addition, sales and cost of goods sold information for 2004 and 2003 are as follows (in millions):

2004 2003

Revenue $5,313.80 $4,754.70

Cost of goods sold $3,522.40 $3,209.60

a. Determine the cash conversion cycles for 2003 and 2004. Round to the nearest whole day.

b. Interpret your findings.

The average accounts receivable, inventory, and accounts payable for Molson Coors Brewing

Co.,Anheuser-Busch Co., and Boston Beer Companyare shown below for a recent fiscal year

(in thousands).

Molson

Coors Anheuser- Boston Beer

Brewing Co. Busch Co. Company

Average accounts receivable $654,600 $ 682,500 $11,629

Average inventory 222,150 638,900 11,225

Average accounts payable 319,043 1,144,250 8,070

Sales and cost of goods sold information for the three companies are as follows (in thousands):

Molson

Coors Anheuser- Boston Beer

Brewing Co. Busch Co. Company

Sales $4,305,816 $14,934,200 $217,208

Cost of goods sold 2,741,694 8,982,500 87,973

a. Determine the cash conversion cycles for the three companies. Round to the nearest

whole day.

b. Interpret your findings.

624 Chapter 13 Statement of Cash Flows

Case 13-4

Analyzing noncash working

capital efficiency—

beer industry

Lexmark International, Inc.

Schedule of Current Assets and Current Liabilities

December 31, 2004, 2003, and 2002

(in millions) Dec. 31, 2004 Dec. 31, 2003 Dec. 31, 2002

Current assets:

Cash and cash equivalents $ 626.20 $ 744.60 $ 497.70

Marketable securities 940.50 451.50

Accounts receivable, net

of allowances 744.40 615.40 600.30

Inventories 464.90 437.00 410.30

Prepaid expenses and other

current assets 224.90 195.30 290.50

Total current assets $3,000.90 $2,443.80 $1,798.80

Current liabilities:

Short-term debt $ 1.50 $ 1.10 $ 12.30

Accounts payable 670.60 465.70 378.50

Accrued liabilities 795.60 716.50 708.20

Total current liabilities $1,467.70 $1,183.30 $1,099.00