Answer:
124.78 days
Explanation:
The computation of the cash cycle is shown below:
The cash cycle = Days inventory outstanding + days sale outstanding - days payable outstanding
where,
Day inventory outstanding = (Average inventory) ÷ cost of goods sold × number of days in a year
= ($126,300) ÷ $282,000 × 365 days
= 163.47 days
Day sale outstanding = (Average Accounts receivable) ÷ Net credit sales × number of days in a year
= ($97,900 ÷ $324,000) × 365 days
= 110.28 days
Day payable outstanding = (Average Accounts payable) ÷ cost of goods sold × number of days in a year
= ($115,100 ÷ $282,000) × 365 days
= 148.97 days
Now put these days to the above formula
So, the days would equal to
= 163.47 days + 110.28 days - 148.97 days
= 124.78 days
