What is the length of the cash cycle in this case??? Morrison Construction, a manufacturer ofcement products, buys raw limestone on crediton July 10. It processes this limestone to makecement powder on July 15 and pays cash for theraw limestone on July 25. On August 2, it sellsthe cement powder to a construction supplycompany, and on August 16, it receives a cashpayment for this sale.What is the length of the cash cycle in thiscase?

Step 1:First, calculate the inventory period: From the date of purchase to the date of sale is known…

Answered: Morrison Construction, a manufacturer…

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter18: Accounting Periods And Methods

Section: Chapter Questions

Problem 46P: Blue Company, an architectural firm, has a bookkeeper who maintains a cash receipts and...

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Romano Inc. has the following data. What is the firm's cash conversion cycle? Inventory Conversion Period = 59 days Receivables Collection Period = 19 days Payables Deferral Period = 41 days Please explain process and show calculations.
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What is the length of the firm's cash conversion cycle on these financial accounting question?
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What is the length of the firm's cash conversion cycle on these accounting question?
Lonergan Company occasionally uses its accounts receivable to obtain immediate cash. At the end of June 2024, the company had accounts receivable of $980,000. Lonergan needs approximately $600,000 to capitalize on a unique investment opportunity. On July 1, 2024, a local bank offers Lonergan the following two alternatives: a. Borrow $600,000, sign a promissory note, and assign the entire receivable balance as collateral. At the end of each month, a remittance will be made to the bank that equals the amount of receivables collected plus 8% interest on the unpaid balance of the note at the beginning of the period. b. Transfer $650,000 of specific receivables to the bank without recourse. The bank will charge a 2% factoring fee on the amount of receivables transferred. The bank will collect the receivables directly from customers. The sale criteria are met. Required: 1. Prepare the journal entries that would be recorded on July 1 for: a. alternative a. b. alternative b. 2. Assuming that…
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