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    Operating Cycle Changes: Increase, Decrease, or No Change

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    Changes in the operating cycle. Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate and increase, the letter d for a decrease, and the letter n for no change.

    a. Receivables average goes up
    b. Credit repayment times for customers are increased
    c. Inventory turnover goes from 3 tunes it 6 times
    d. Payables turnover goes from 6 times to 11 times
    e. Receivables turnover goes from 7 times to 9 times
    f. Payments to suppliers are accelerated.

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    Changes in the operating cycle. Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate and increase, the letter d for a decrease, and the letter n for ...

    Solution Summary

    The solution indicates the effects on the operating cycle.

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