51. ABC Company has P15,000,000 of sales, P2,000,000 of inventories, P3,000,000 of receivables and P1,000,000 of payables. Its cost of goods sold is 80% of sales, and it finances working capital with bank loan at 8% rate. The company wants to lower its inventories and receivables by 10% each and increase its payables by 10%, all without affecting sales or cost of goods sold, What would be the new cash conversion cycle if the changes are made? [nearest whole number]

51. ABC Company has P15,000,000 of sales, P2,000,000 of inventories, P3,000,000 of receivables and P1,000,000 of payables. Its cost of goods sold is 80% of sales, and it finances working capital with bank loan at 8% rate. The company wants to lower its inventories and receivables by 10% each and increase its payables by 10%, all without affecting sales or cost of goods sold, What would be the new cash conversion cycle if the changes are made? [nearest whole number]

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 2MC

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