Please provide correct answer accounting.... What is the cash conversion cycle for a firm with $3million average inventories, $1.5 million averageaccounts payable, a receivables period of 40 days, andan annual cost of goods sold of $18 million?

Step 1:Formula of total conversion cycle is Days in inventory+ days in accounts receivable - days…

Answered: What is the cash conversion cycle for a…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 3MC

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Provided the following information: Sales =$1,440,000, Cost of Goods Sold= $1,100,000, Inventory=$200,000, Receivables=$160,000, Payables=S100,000 and there are 365 days in a year. What is the cash conversion cycle for the firm? a. 113.55 Days b. 77.05 Days c. 150.05 Days d. 73 Days e. None of the above
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?
Whaley & Whaley has the following data. What is the firm's cash conversion cycle? Inventory conversion period = Average collection period = Payables deferral period = O a. 37 days O b. 31 days O c. 41 days Od: 45 days O e. 34 days 41 days 31 days 38 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?
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22) A firm has the following data: Inventory conversion period = 75 days Average collection period = 32 days Payables deferral period = 45 days What is the firm's cash conversion cycle? 1. 5 days. 2. 40 days. 3. 62 days. 4. 88 days. 5. 15 days.
FMT Trading Inc. has the following financial data: Annual sales 10,000,000Cost of goods sold 6,000,000Inventory 2,547,945Accounts receivable 1,643,836Accounts payable 1,200,000 a. What is the firm’s cash conversion cycle?b. Provide interpretations of the cash conversion cycle period of the firm.

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What is the cash conversion cycle for a firm with $3 million average inventories, $1.5 million average accounts payable, a receivables period of 40 days, and an annual cost of goods sold of $18 million?