BMC Co. has an average A/R balance of P1,250,000, average inventory balance of P1,750,000, and average accounts payable balance of P800,000. Its annual sales are P12,000,000 and its cost of goods sold represents 80% of annual sales. Assume there are 365 days in a year. What is BMC Co.’s cash conversion cycle?

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A: INFORMATION:  Annual sales               =         10,000,000Cost of goods sold    =…

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A: Solution Working note - Average daily sales = 3375000 / 360 = 9,375.

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A:

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A: The answer is stated below:

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A: Receivables turnover = Net credit sales / Average Receivables

Q: nt of

A:

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.