New Doors Corp. has $375,000 of total assets, and it uses $187,500 of total shareholder's equity capital.  Its sales for the last year were $520,000, and its net income was $25,000.  Stockholders recently voted in a new management team that has promised to lower costs and get the return on equity (ROE) up to 15.0%.  What profit margin (PM) would the firm need in order to achieve the 15% ROE, holding everything else constant?   1. 10.71%   2. 5.41%   3. 9.41%   4. 12.66%   5. 8.11%

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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.