Principles of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
Principles of Corporate Finance (Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
12th Edition
ISBN: 9781259144387
Author: Richard A Brealey, Stewart C Myers, Franklin Allen
Publisher: McGraw-Hill Education
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Chapter 29, Problem 5PS
Summary Introduction

To determine: The impact of changes on firm’s cash cycle.

Cash cycle is the overall circulation or cycle of cash commences from the payment of raw materials and ends with receipt of cash on goods sold.

Cash cycle=[Inventory holding period+Average collection period Average payment period]

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