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Cornerstones of Financial Accounting

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 15DQ

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Question

How did you calculate the number?

A firm currently has a 35-day cash cycle. Assume that the
firm changes its operations such that it decreases its
receivables period by 4 days, increases its inventory period
by 2 days and decreases its payables period by 3 days. What
will the length of the cash cycle be after these changes?
How did you calculate the number?

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