Answered: Calculate the cash conversion cycle.…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 11P: Negus Enterprises has an inventory conversion period of 50 days, an average collection period of 35...

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Stratosphere Wireless is examining its cash conversion cycle. The company expects its cost of goods sold, which equals 60 percent of sales, to be $144,000 this year. Stratosphere normally turns over inventory 30 times per year, accounts receivable is turned over 12 times per year, and the accounts payable turnover is 45. Assume there are 360 days in a year.

Calculate the cash conversion cycle. Round your answer to the nearest whole number.

days
Calculate the average balances in accounts receivable, accounts payable, and inventory. Round your answers to the nearest dollar.

Accounts receivable: $

Accounts payable: $

Inventory: $

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