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Dover Wholesalers Sells Products Exclusively to Benn Retailer

Question 52

Multiple Choice

Dover Wholesalers sells products exclusively to Benn Retailer.Benn Retailer buys exclusively from Dover Wholesalers.Dover Wholesalers has a receivables period of 44 days,an inventory period of 8 days,and a payables period of 63 days.Benn Retailer has an inventory period of 15 days,a receivables period of 22 days,and a payables period of 44 days.Which one of the following statement is correct given this information?


A) Dover Wholesalers has a shorter operating cycle than does Benn Retailer.
B) Benn Retailer has an operating cycle of 81 days.
C) It takes Benn Retailer less time to collect payment on a sale than it does for the firm to sell its inventory.
D) Dover Wholesalers is financing 100 percent of Benn Retailer's operating cycle.
E) Dover Wholesalers has a cash cycle of 11 days.

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