Due to a cool spring season, Petra’s pool installation business has not had the sales she anticipated. To generate new business, Petra has decided to offer a deferred payment plan. A customer is interested in a pool installation worth $42,800. If Petra structures the contract to require a $5,000 down payment, followed by 24 equal monthly payments with the first payment due in 6 months from now, how much should those payments be if Petra’s cost of capital is 4.8% compounded monthly?

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Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.