What question did they need to answer ? They get paid according to their contracts with the big 3 most of it at 12 Months ??? I just posted this on Wahoo....
It's amazing that some very smart traders I know cant reconcile this issue... It's called a CONTRACT & if Co. ABC says I'll pay you in 3 installments & the last at 12 months most would say OK .... But then they complain OMG A/R's are going higher every Qtr ???? Hello Yes they are because sales are going much higher... simple example...
Year 1 30 mill in sales
Year 2 50 Mill in Sales
Year 3 75 Mill in Sales
Year 4 130 Mill in Sales
If we get paid at 12 month mark to keep it simple at end of Year 2 the 30 Mill got paid & A/R's are 50 Mill $$$$ at the end of Year 3 got paid the 50 Mill $$$ but A/R's are 75 Mill $$$ and at end of Year 4 got paid the 75 Mill $$$ but A/R's jumped to 130 Mill $$$$ ....
As long as sales climb so will A/R's & AGAIN for the 100TH time the Big 3 combined a 325 BILLION $$$$ companies have NEVER beaten TSTC out of a dime & pay according to their CONTRACT really not to tough to figure out...
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