You collect 75% of a month's sales in the month of the sale and 25% of sales in the following month. May sales June sales July sales O $105 O $35 $120 Compute cash inflows for June. O $135 $140 $100 not enough information, because sales revenue differs

You collect 75% of a month's sales in the month of the sale and 25% of sales in the following month. May sales June sales July sales O $105 O $35 $120 Compute cash inflows for June. O $135 $140 $100 not enough information, because sales revenue differs

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

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.

Question

You collect 75% of a month's sales in the month of the
sale and 25% of sales in the following month.
May
sales
June
sales
July
sales
O $105
O $35
$120
Compute cash inflows for June.
$135
$140
$100
not enough information, because sales revenue differs

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