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3 years ago

The Dewey Corporation has the following data, in thousands. Assuming a 365-day year, what is the firm's cash conversion cycle?

Business

1 answer:

Wewaii [24]3 years ago

6 0

Answer:

d. 35 days

Explanation:

Cash conversion cycle = Average inventory/ (COGS/365) + Average account receivables/(Credit sales/365) - Average account payable / (COGS/365)

Cash conversion cycle = 4,000 / (31,500/365) + 2,000/(45,000/365) - 2,400/(31,5000/365)

Cash conversion cycle = 4,000/86.3014 + 2,000/123.2877 - 2,400/86.3014

Cash conversion cycle = 46.3492 + 16.2222 - 27.8095

Cash conversion cycle = 34.7619

Cash conversion cycle = 35 days

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