What is the length of the firm's cash conversion cycle on these accounting question? For the Bayer Company, the average age ofaccounts receivable is 60 days, the average ageof accounts payable is 45 days, and the averageage of inventory is 72 days. Assuming a 365-dayyear, what is the length of the firm's cashconversion cycle?

Step 1: Define Cash Conversion CycleThe cash operating cycle is operating cycle less creditors…

Answered: For the Bayer Company, the average age…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2MC

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For the Bayer Company, the average age of accounts receivable is 60 days, the average age of accounts payable is 45 days, and the average age of inventory is 72 days. Assuming a 365-day year, what is the length of of the firm's cash conversion cycle?
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What is the cash conversion cycle?
ML has the following data. What is the firm's cash conversion cycle? Inventory conversion period = 50 days Average collection period = 17 days Payables deferral period = 25 days 34 days 46 days 31 days 38 days O 42 days
A firm has an average age of inventory of 100 days, an average collection period of 40 days, and an average payment period of 30 days. The firm's cash conversion cycle is?
C. Exodus Corp. is analyzing the performance of its cash management. On the average, the firm holds inventory 65 days, pays its suppliers in 35 days, and collects its receivables in 15 days. The firm has a current annual outlay of P1,960,000 on operating cycle investments. Exodus currently pays 10 percent for its negotiated financing. (Assume a 360-day year.) Calculate the following: a. Cash conversion cycle b. Operating cycle. c. Daily expenditure and the firm's annual savings if the operating cycle is reduced by 15 days.
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What is the length of loud noise recordings' cash conversion cycle (CCC) for this accounting question?
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A firm has steady inflows and periodic outflows and wants to use the Beranek model to manage its cash. Cash outflows occur once per month; the amount of the next outflow is $2.16 million. It costs $200 to make an investment or a disinvestment. The yearly interest rate is 8 percent. Calculate: a. The optimal number of transactions. b. The amount of the periodic investments. c. The amount of the final withdrawal. d. The net profit from this strategy.

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For the Bayer Company, the average age of accounts receivable is 60 days, the average age of accounts payable is 45 days, and the average age of inventory is 72 days. Assuming a 365-day year, what is the length of the firm's cash conversion cycle?