Lionheart Inc.has the information shown above on its annual Income Statement and Balance Sheet (all numbers shown are in thousands) .What is Lionheart's cash conversion cycle?

Question

Lionheart Inc.has the information shown above on its annual Income Statement and Balance Sheet (all numbers shown are in thousands).What is Lionheart's cash conversion cycle?

Quizplus · Accepted Answer

D) Cash conversion cycle = inventory days + accounts receivable - accounts payable
Inv Days = 3300 / (63,750 / 365) = 32.7755;
Accounts Rec Days = 14,340/ (96,400 / 365) = 54.2956;
Accounts Payable Days = 16,560 / (63,750 / 365) = 94.8141;
Cash conversion cycle = 32.7755 + 54.2956 - 94.8141 = - 7.743 days