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Cash conversion cycle; Accounts receivable collection period

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A company has inventory days of 75, accounts receivable days of 30, and accounts payable days of 90. What is the cash conversion cycle?

A company has sales of $60 million this year. Its accounts receivable balance averaged $2 million. How long on average does it take the firm to collect on its sales?

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The solution explains the problem and shows the calculations to arrive at the answers.

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The cash conversion cycle measures the time it takes a company to convert resources back to cash.

The formula for the cash ...

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