Problem

Changes in the Operating Cycle. Indicate the effect that the following will have on the op...

Changes in the Operating Cycle. Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate an increase, the letter D for a decrease, and the letter N for no change.

a. Average receivables go up.


b. Credit payment times for customers are increased.


c. Inventory turnover goes from 3 times to 7 times.


d. Payables turnover goes from 6 times to 11 times.


e. Receivables turnover goes from 7 times to 9 times.


f. Payments to suppliers are accelerated.

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Solutions For Problems in Chapter 16