Calculate the length of the cash conversion cycle

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Reference no: EM132600604

Southern Manufacturing is doing some short-term financial planning because they'd like to lower their short-term borrowing costs.

Question 1: Calculate the length of the cash conversion cycle for a firm with $50,000 in average inventory, $60,000 in average receivables, $30,000 in average payables, annual sales of $900,000, and an annual cost of goods sold of 70% of sales.

Question 2: What strategies could Southern undertake to improve their cash conversion cycle.

Reference no: EM132600604

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