1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Lina20 [59]
1 year ago
11

A firm has an inventory period of 94.2 days, an accounts payable period of 40.4 days, and an accounts receivable turnover rate o

f 17.6. what is the length of the cash cycle?
Business
1 answer:
iren [92.7K]1 year ago
8 0

The length of the cash conversion cycle is 74.54 days.

Given here, the accounts receivable turnover rate is 17.6.

First , we have to calculate the Days sales outstanding with the formula Days sales outstanding(DSO) = 365/Account receivable turnover

                                                 = 365/17.6

                                                 = 20.74days.

Now we have to calculate the cash conversion cycle, with the formula Cash conversion cycle= DSO + DIO - DPO (DSO=Days sales outstanding, DIO = days inventory outstanding, DPO= days payables outstanding) .                

                                                 = 20.74+94.2-40.4

          Cash conversion cycle = 74.54 Days.

The period (in days) it takes for a business to convert its investments in inventory and other resources into cash flows from sales is known as the cash conversion cycle (CCC). Cash Cycle, aims to quantify the length of time that each net input dollar spends in the production and sales cycle before it is turned into received cash. The CCC is one of a number of quantitative metrics that are used to assess how effectively a company's operations and management are conducted.

Rising CCC numbers should prompt more research and analysis based on other criteria, whereas declining or stable CCC values over several periods are a healthy sign. Keep in mind that the CCC only applies to certain industries that depend on inventory management and related activities.

To learn more about cash conversion cycle, refer this link.

brainly.com/question/19595232

#SPJ4

You might be interested in
Happy employees what
lyudmila [28]
Employees be bonkers
7 0
2 years ago
You expect to receive year-end bonuses of $8,000 at the end of this year, $16,000 at the end of year 4, $20,000 at the end of ye
yulyashka [42]

Answer:

Total PV= $46,728.79

Explanation:

Giving the following information:

Cash flow:

Cf1= $8,000

Cf4= $16,000

Cf8= $20,000

Cf10= $25,000

Discount rate= 6%

To calculate the present value, we need to use the following formula on each cash flow:

PV= FV/(1+i)^n

Cf1= 8,000/(1.06^1)= 7,547.17

Cf4= 16,000/(1.06^4)= 12,673.50

Cf8= 20,000/(1.06^8)= 12,548.25

Cf10= 25,000/(1.06^10)= 13,959.87

Total PV= $46,728.79

7 0
2 years ago
with this type of externality, in the absence of government intervention, the market equilibrium quantity produced will be than
ikadub [295]

The type of externality where market equilibrium quantity produced will be more than socially optimal quantity in absence of governemtn intervention is Negative externality.

Let understand that whenever a production of good or service negatively affect the unrelated third party who is not directly involved in a market transaction, it is said that negative externality exists in the scenario.

A very good example of commonly cited Negative Externalities are air pollution and noise pollution which was caused during production an affects unrelated third party.

If there is presence of government intervention in the production, then, the production of goods or service will be halted.

Therefore, in conclusion, this type of externality is called the Negative Externality.

Read more about Negative Externality here

<em>brainly.com/question/13901028</em>

7 0
2 years ago
A manager who wishes to be successful in international business should avoid a(n) ________ attitude.
coldgirl [10]

Answer: ethnocentric

Explanation:

6 0
2 years ago
Major Co. reported 2016 income of $303,000 from continuing operations before income taxes and a before-tax loss on discontinued
Mama L [17]

Answer: $109,080; $145,920

Explanation:

Based on the information that have been provided in the question, the following can be gotten:

The amount for income tax expenses will be:

= 36% of $303,000

= 36/100 × $303,000

= 0.36 × $303,000

= $109,080

The net income will be:

Reported income = $303,000

Less income tax = $109,080

Less loss on discounted operation = $48,000

Net income = $145,920

Loss on discounted operation:

= $75,000 × (1 - 36%)

= $75,000 × (1 - 0.36)

= $75,000 × 0.64

= $48,000

3 0
2 years ago
Other questions:
  • BSU Inc. wants to purchase a new machine for $40,070, excluding $1,200 of installation costs. The old machine was bought five ye
    14·1 answer
  • Select all that apply.
    6·2 answers
  • Sarah is concerned about identity theft. She wants to check her overall credit worthiness. Sarah should MOST LIKELY
    6·1 answer
  • Customer service in the aviation industry slideshare
    11·1 answer
  • there is agrowing demand of architects and engineers in devloping countries like nepal justify this statement​
    5·1 answer
  • Madison Company issued an interest-bearing note payable with a face amount of $10,800 and a stated interest rate of 8% to the Me
    7·1 answer
  • Suppose that a labor economist finds that one of her research subjects has earned significantly higher wages throughout his life
    12·1 answer
  • Assume you just purchased 100 shares of Apple stocks at $300. You are worrying that the competition from other tablet PC and sma
    11·1 answer
  • How can entrepreneurs save money in case the government increases taxes on small businesses?
    13·1 answer
  • Assume that the full-employment level of output is $2,000 and the price level associated with full-employment output is 100. Als
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!