Your consulting firm was recently hired to improve the performance of RP Inc, which is highly profitable but has been experiencing cash shortages due to its high growth rate. As one part of your analysis. you want to determine the firm's cash conversion cycle. Using the following information and a 365-day year, what is the firm's present cash conversion cycle?
Your consulting firm was recently hired to improve the performance of RP Inc, which is highly profitable but has been experiencing cash shortages due to its high growth rate. As one part of your analysis. you want to determine the firm's cash conversion cycle. Using the following information and a 365-day year, what is the firm's present cash conversion cycle?
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter5: Risk Analysis
Section: Chapter Questions
Problem 5QE
Related questions
Question
![Your consulting firm was recently
hired to improve the performance of
RP Inc, which is highly profitable but
has been experiencing cash
shortages due to its high growth
rate. As one part of your analysis.
you want to determine the firm's
cash conversion cycle. Using the
following information and a 365-day
year, what is the firm's present cash
conversion cycle?
Average inventory
Annual sales
Annual cost of goods seld
Average accounts receivable
Average accunts payable
P5.000
P00.000
PH0,000
P0,000
F5000
140.6 days
120.6 days
133.6 days
148.0 days
O 126.9 days](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3b2d3900-3371-42e8-86f9-13f5bec518e3%2F9abd2439-59cc-4b87-8ba6-1042994f1edb%2Fv5ghyc8f_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Your consulting firm was recently
hired to improve the performance of
RP Inc, which is highly profitable but
has been experiencing cash
shortages due to its high growth
rate. As one part of your analysis.
you want to determine the firm's
cash conversion cycle. Using the
following information and a 365-day
year, what is the firm's present cash
conversion cycle?
Average inventory
Annual sales
Annual cost of goods seld
Average accounts receivable
Average accunts payable
P5.000
P00.000
PH0,000
P0,000
F5000
140.6 days
120.6 days
133.6 days
148.0 days
O 126.9 days
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