By how many days would the cash conversion cycle be

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By how many days would the cash conversion cycle be changed?

Cash conversion cycle

Cyree Inc. has annual sales of $80,000,000; its average inventory is $20,000,000; and its average accounts receivable is $16,000,000. The firm buys all raw materials on terms of next 35 days, and it pays on time. The firm is searching for ways to shorten the cash conversion cycle. If sales can be maintained at existing levels while lowering inventory by $4,000,000 and accounts receivable by $2,000,000, by how many days would the cash conversion cycle be changed? Use a 365-day year.

a) -27.4

b) -28.7

c) -30.2

d) -31.7

e) -33.3

Reference no: EM13355803

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