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XYZ Manufacturing has the following operational data: • Inventory holding period: 35 days • Customer collection period: 25 days Supplier payment period: 20 days Calculate: 1. XYZ's business operating cycle 2. XYZ's cash conversion cycle 3. If XYZ wants to reduce its cash conversion cycle by 15 days, what options does it have?

XYZ Manufacturing has the following operational data: • Inventory holding period: 35 days • Customer collection period: 25 days Supplier payment period: 20 days Calculate: 1. XYZ's business operating cycle 2. XYZ's cash conversion cycle 3. If XYZ wants to reduce its cash conversion cycle by 15 days, what options does it have?

Corporate Fin Focused Approach
Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter16: Supply Chains And Working Capital Management
Section: Chapter Questions
Problem 11P
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Subject: financial accounting

XYZ Manufacturing has the following operational data: • Inventory holding period: 35 days • Customer collection period: 25 days Supplier payment period: 20 days Calculate: 1. XYZ's business operating cycle 2. XYZ's cash conversion cycle 3. If XYZ wants to reduce its cash conversion cycle by 15 days, what options does it have?
Transcribed Image Text:XYZ Manufacturing has the following operational data: • Inventory holding period: 35 days • Customer collection period: 25 days Supplier payment period: 20 days Calculate: 1. XYZ's business operating cycle 2. XYZ's cash conversion cycle 3. If XYZ wants to reduce its cash conversion cycle by 15 days, what options does it have?
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