If the company could reduce its accounts receivable to the


Suppose a company has a DSO that is considerably higher than its industry average. If the company could reduce its accounts receivable to the point where its DSO was equal to the industry average without affecting its sales or its operating costs, how would this affect (a) its free cash flow? (b) its return on common equity? (c) its debt ratio? (d) its times-interest-earned ratio? (e) its loan / EBITDA ratio? (f) its price/earnings ratio? (g) its market/book ratio?

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Business Management: If the company could reduce its accounts receivable to the
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