XYZ Company's Average Accounts payable is OMR 240,000 and total Purchases is OMR 700,000. The Cash purchases are 30% of total purchases. In this case, the Average payment period of the company will be: O a. 145.75 days O b. 182.94 days O c. 192.67 days o d. 178.78 days

XYZ Company's Average Accounts payable is OMR 240,000 and total Purchases is OMR 700,000. The Cash purchases are 30% of total purchases. In this case, the Average payment period of the company will be: O a. 145.75 days O b. 182.94 days O c. 192.67 days o d. 178.78 days

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 11EB: Gear Up Co. pays 65% of its purchases in the month of purchase, 30% in the month after the purchase,...

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Concept explainers

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.

Question

XYZ Company's Average
Accounts payable is OMR
240,000 and total Purchases is
OMR 700,000. The Cash
purchases are 30% of total
purchases. In this case, the
Average payment period of
the company will be:
O a. 145.75 days
O b. 182.94 days
O c. 192.67 days
O d. 178.78 days

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