- Capital Budgeting
- Capital Budgeting Ratios
- Payback Period and Discounted Payback Period
Inventory Conversion Period & Average Collection Period
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Kleck Corporation has $500,000 of inventory, and its annual sales are $3,000,000. Based on a 365 day year, what is Kleck's inventory conversion period?
a. 56.49 days
b. 57.04 days
c. 60.83 days
d. 62.81 days
e. 65.27 days
Carroll Construction has annual sales of $730,000, and it has $100,000 of accounts receivable. Based on a 365-day year, what is Carroll's average collection period (or DSO)?
a. 50 days
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b. 52 days
c. 54 days
d. 56 days
e. 58 days
13 - Inventory conversion period = ...
The solution computes inventory conversion period and average collection period.