After studying this chapter, you should be able to meet the following learning objectives (LO).
During 2010, George Douglas, president of C&C Sports, became increasingly concerned about the company's cash difficulties. The company ended the year with about $7,000 in cash, and with no operational changes planned for 2011 George fears that balance is too low if unexpected expenses should arise. For the last few years, the company has not generated enough cash to sustain operations and has had to acquire short-term loans while at the same time paying off long-term debt. Sales and income are increasing, but so are inventories, which tie up the company's cash. How can George increase cash and reduce C&C's borrowings?
To remedy this situation, George knows that he needs to increase sales, reduce ...