No. 1. Abbott Private Limited wants to purchase an equipment worth $2650,000. However, the firm is in short of funds and thus would be looking to borrow the amount from a bank. The bank manager has offered two different types of loans i.e. 14.16% interest rate for 50 years with quarterly installments and 14% interest rate for 50 years with monthly installments. Being the finance manager of the company, you have been given a task to calculate the quarterly and monthly installment amounts as well as make a choice between both the loans i.e. which loan is to be opted and why?

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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.