Tt1. Santana Rey's two departments, Computer Consulting Services and Computer Workstation Furniture Manufacturing, haveeach been profitable for Business Solutions. Santana has heard of the cash conversion cycle and wants to use it asanother performance measure for the workstation manufacturing department. Data below are for the most recent twoquarters.1st Quarter 2nd QuarterdaysdaysdaysDays' sales in accounts receivable 28Days' sales in inventory34Days' payable outstanding4030 days33 days37 daysRequired:1&2. Compute cash conversion cycle for the first quarter and second quarter.3. Did cash conversion cycle improve or worsen from the first to the second quarter?

The cash conversion cycle tells about the time taken by the business to convert its customers,…

Santana Rey's two departments, Computer Consulting Services and Computer Workstation Furniture Manufacturing, have each been profitable for Business Solutions. Santana has heard of the cash conversion cycle and wants to use it as another performance measure for the workstation manufacturing department. Data below are for the most recent two quarters. Days' sales in accounts receivable 28 34 Days' sales in inventory Days' payable outstanding 1st Quarter 2nd Quarter days days days Required: 40 30 days 33 days 37 days

Santana Rey's two departments, Computer Consulting Services and Computer Workstation Furniture Manufacturing, have each been profitable for Business Solutions. Santana has heard of the cash conversion cycle and wants to use it as another performance measure for the workstation manufacturing department. Data below are for the most recent two quarters. Days' sales in accounts receivable 28 34 Days' sales in inventory Days' payable outstanding 1st Quarter 2nd Quarter days days days Required: 40 30 days 33 days 37 days

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter16: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 11P

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