Which one of the following will not affect the operating cycle? A) increasing the payables turnover...
Which one of the following will not affect the
operating cycle?
A) increasing the payables turnover from 7 times to 10 times
B) increasing the days sales in receivables (DSO)
C) decreasing the inventory turnover rate
D) increasing the average receivables balance
E) decreasing the credit repayment times for the firm's
customers
Homework Answers
Operating Cycle = Inventory Period + Accounts Receivables period.
Operating Cycle can be defined as the time taken by company to buy Inventory, convert it into sales and receives accounts receivables from customer. Since, Accounts Payable turnover is not part of Operating Cycle.
Hence Ans is OPTION A Increasing the payables turnover from 7 times to 10 times
Add Answer to:
Which one of the following will not affect the
operating cycle?
A) increasing the payables turnover...
A decrease in which one of the following will increase the cash cycle, all else held...
A decrease in which one of the following will increase the cash cycle, all else held constant? a. Payables turnover b. Days sales in inventory c. Operating cycle d. Inventory turnover rate e. Accounts receivable period
3. Calculate the Cash Conversion Cycle (use end-of-period amounts rather than average of receivables, inventory, and...
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An increase in which one of the following will decrease the cash cycle, all else equal?...
An increase in which one of the following will decrease the cash cycle, all else equal? O Operating cycle O Accounts receivable period O Days sales in inventory O Inventory turnover rate O Payables turnover
Instructions For 2017 and 2018, calculate current ratio, quick (acid-test) ratio, inventory turnover and days' inventory...
Instructions For 2017 and 2018, calculate current ratio, quick (acid-test) ratio, inventory turnover and days' inventory outstanding (DIO), accounts receivable turnover, days' sales in average receivables or days' sales outstanding (DSO), accounts payable turnover, days' payable outstanding (DPO), and cash conversion cycle (in days). a. Use the cost of goods sold in the formula for accounts payable turnover. b. Use a 365-day year for calculations as needed. c. Use cell references from prior calculations, if applicable. (Always use cell references...
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CASH CONVERSION CYCLE Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $183,000; its cost of goods sold is 80% of sales, and it earned a net profit of 4%, or $7,320. It turned over its inventory 4 times during the year, and its DSO was 39 days. The firm had fixed assets totaling $34,000. Chastain's payables deferral period...
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CASH CONVERSION CYCLE Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $272,000; its cost of goods sold is 80% of sales; and it earned a net profit of 3%, or $8,160. It turned over its inventory 4 times during the year, and its DSO was 35 days. The firm had fixed assets totaling $32,000. Chastain's payables deferral period...
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CASH CONVERSION CYCLE Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $240,000; its cost of goods sold is 80% of sales; and it earned a net profit of 2%, or $4,800. It turned over its inventory 5 times during the year, and its DSO was 31.5 days. The firm had fixed assets totaling $40,000. Chastain's payables deferral period...
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Instructions For 2017 and 2018, calculate current ratio, quick (acid-test) ratio, inventory turnover and days' inventory outstanding (DIO), accounts receivable turnover, days' sales in average receivables or days' sales outstanding (DSO), accounts payable turnover, days' payable outstanding (DPO), and cash conversion cycle (in days). a. Use the cost of goods sold in the formula for accounts payable turnover. b. Use a 365-day year for calculations as needed. c. Use cell references from prior calculations, if applicable. (Always use cell references...
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CASH CONVERSION CYCLE Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $183,000; its cost of goods sold is 80% of sales, and it earned a net profit of 4%, or $7,320. It turned over its inventory 4 times during the year, and its DSO was 39 days. The firm had fixed assets totaling $34,000. Chastain's payables deferral period...
CASH CONVERSION CYCLE Chastain Corporation is trying to determine the effect of its inventory turnover ratio and days sales outstanding (DSO) on its cash conversion cycle. Chastain's 2016 sales (all on credit) were $240,000; its cost of goods sold is 80% of sales; and it earned a net profit of 2%, or $4,800. It turned over its inventory 5 times during the year, and its DSO was 31.5 days. The firm had fixed assets totaling $40,000. Chastain's payables deferral period...
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