Shortening a 121-day cash cycle to 92 days closes the April funding gap in this GF520 Unit 9 working capital plan, using inventory, receivables and payables together. Searches like "gf 520 unit 9 assignment example", "gf520 unit 9 sample" and "gf520 unit 9 example" land here.
What a finished GF520 Unit 9 working capital plan looks like
A plan of about five pages built around one monthly cash budget. The diagnosis comes first: on 120 million dollars of sales and 78 million of cost of goods, inventory sits 95 days, customers pay in 58 and suppliers are paid in 32, a cash conversion cycle of 121 days. The budget shows borrowing peaking at 9.4 million in April against a 7-million revolver. Three levers follow, each sized. Postponing final packaging until orders arrive cuts inventory days to 80, releasing about 3.2 million. Tighter terms for the two largest retail accounts bring collection to 50 days, releasing 2.6 million. Supplier days rise to 38 on accounts offering no discount, adding 1.3 million, while the 2/10 net 30 discount is always taken because forgoing it costs 37 percent a year.
How a GF520 Unit 9 example is structured
Diagnosis, budget, levers, result. The opening section computes the three components of the cycle from the balance sheet and income statement, showing each formula once, and compares them with two peers so the 121 days has a benchmark. The monthly cash budget comes next, twelve columns of receipts, disbursements and cumulative financing need, because the problem is a date, not an annual total. Each lever then gets its own section with a mechanism, a sized effect and a side effect: shorter terms may cost a retail account, stretched payables may strain a supplier. The payables section separates suppliers that offer early-payment discounts from those that do not, since the right policy differs. A revised budget shows the April peak falling within the line. The plan ends on three monthly measures that management would watch to confirm progress.
The cycle in three numbers
Inventory, receivable and payable days are computed from reported balances and set beside two peers, so the 121-day figure reads as a gap rather than a fact.
A budget by month
Twelve columns of receipts and payments locate the pressure in April, where cumulative borrowing reaches 9.4 million dollars against a 7-million line.
Inventory held back, not cut
Final packaging waits for confirmed orders, trimming inventory days from 95 to 80 without reducing the product range retailers expect in spring.
Two payables policies, not one
Discount-offering suppliers are paid on day ten because the forgone discount costs about 37 percent a year; the rest are paid on the due date.
The April line, rerun
A revised budget with all three levers applied brings peak borrowing to about 6.3 million, inside the revolver, and names monthly measures for tracking each lever.
Where marks go in GF520 Unit 9
An annual view is the costliest mistake a working capital plan can make. A plan that computes the cash conversion cycle, recommends reducing it and stops there has not shown when the firm runs short, which is the question a seasonal business actually faces. Levers proposed without a sized effect, such as tighter credit terms with no days or dollars attached, read as a checklist. Stretching every payable without separating discount suppliers draws a specific deduction in many sections, because forgoing a 2/10 net 30 discount is expensive borrowing. Ignoring side effects, lost customers or strained suppliers, suggests the plan was written without the business in view. Formula errors, such as cost of goods used where sales belongs in receivable days, are marked as technical. The best plans end on measures management can watch monthly.
Get a GF520 Unit 9 example written to your instructions
For your GF520 Unit 9 plan, forward the case's balance sheets, income statement and any monthly sales pattern, with the prompt and rubric. A cash budget by month comes back alongside three sized levers, their side effects and a rerun of the peak month. A first custom sample costs you nothing; delivery normally takes 24-48h.
GF520 Unit 9 questions, answered
Is taking the early-payment discount always right?
When the firm can borrow for less than the discount's implied rate, yes. Forgoing a 2/10 net 30 discount is equivalent to borrowing for twenty days at an annualized cost near 37 percent, far above most credit lines. The sample takes every such discount and funds it from the revolver. A firm with no access to credit faces a different choice, and the plan would say so.
Should receivable days use sales or credit sales?
Credit sales, where the case separates them, since cash sales never create a receivable. Many cases give total sales only, and the sample then uses total sales and notes the assumption. For inventory and payable days, cost of goods sold is the better base, because both balances are recorded at cost rather than at selling price.
Why build a monthly budget when the prompt only asks for ratios?
Because the ratios describe an average and the problem is usually a peak. A seasonal firm can have an acceptable annual cycle and still breach its credit line for six weeks. If your prompt asks only for ratios, the custom version can confine itself to them, but the sample shows why graders often reward the monthly view when it is offered.