Cash Conversion Cycle: AR period, AP period, inventory period
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Cash Conversion Cycle. Calculate the accounts receivable period, accounts payable period, inventory period, and cash conversion cycle for the following firm:
Income statement data:
Sales 5,000
Cost of goods sold 4,200
Balance sheet data:
See the table in the attachment.
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Solution Summary
The solution shows all the calculations that were used to arrive at the correct answers.
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Accounts receivable period = Average receivables /Sales * 365
= ((100+120)/2)*365/5000 = 8.03 ...
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