Reference no: EM132982940

Question - Rauch Co. has the following selected information from its most recent annual financial statements:

20X8 $ 20X7 $

Accounts receivable 223,400 226,700

Inventories 121,700 151,600

Accounts payable 177,400 153,900

Sales (all on credit) 779,800 798,300

Cost of goods sold 350,910 359,235

Operating expenses* 77,400 78,900

*Operating expenses include depreciation and amortization of $10,500 in 20X8 and $10,100 in 20X7. The company pays 8% annual interest on borrowings from its bank.

What is the interest cost on the cash required to finance the company's estimated cash conversion cycle in 20X8? (For calculations, use 365 days in a year and round all calculations to the nearest day.)

a) $12,819

b) $17,433

c) $18,117

d) $22,221