Riverbed Company sold $76000 worth of goods on account to Bramble Inc. on June 20. Riverbed marks all goods up 25% on cost. Bramble has 45 days to return the goods for any reason. On July 1, Bramble returns $6650 worth of goods. Riverbed expects to be able to resell the returned goods at a profit. The journal entries for Riverbed to record the initial sales on June 20 included debits to O Inventory for $76000, and Cash for $60800. O No entry can be made because the items can be returned. O Accounts Receivable for $76000, and Cost of Goods Sold for $60800. O Accounts Receivable for $76000, and Sales of $60800.

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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.