The Dewey Corporation has the following data, in thousands. Assuming a 365-day year, what is the firm's cash conversion cycle? Annual sales =
Annual cost of goods sold =
Inventory =
Accounts receivable =
Accounts payable = $45,000
$31,500
$4,000
$2,000
$2,400
a. 25 days
b. 28 days
c. 31 days
d. 35 days
e. 38 days

d. 35 days

Explanation:

Cash conversion cycle = Average inventory/ (COGS/365) + Average account receivables/(Credit sales/365) - Average account payable / (COGS/365)

Cash conversion cycle = 4,000 / (31,500/365) + 2,000/(45,000/365) - 2,400/(31,5000/365)

Cash conversion cycle = 4,000/86.3014 + 2,000/123.2877 - 2,400/86.3014

Cash conversion cycle = 46.3492 + 16.2222 - 27.8095

Cash conversion cycle = 34.7619

Cash conversion cycle = 35 days

answer; descriptive statistics;