The following information is available for Blankenship Company for the most recent year.
What was Blankenship's operating cycle for the most recent year? (rounded)

A)30 days
B)50 days
C)80 days
D)120 days

Question

The following information is available for Blankenship Company for the most recent year.
What was Blankenship's operating cycle for the most recent year? (rounded)

A)30 days 
B)50 days 
C)80 days 
D)120 days

Quizplus · Accepted Answer

The operating cycle is the time it takes for a company to convert its inventory and accounts receivable into cash. The formula for operating cycle is inventory conversion period + receivables collection period. Given the information provided, the inventory conversion period is 50 days and the receivables collection period is 30 days. Therefore, the operating cycle is 80 days (50 + 30).

The Following Information Is Available for Blankenship Company for the Most