Consider the following financial statement information for the Bulldog Icers Corporation:

How long is the cash cycle?

Question

Consider the following financial statement information for the Bulldog Icers Corporation:

How long is the cash cycle?

Quizplus · Accepted Answer

Inventory turnover = $58,638/[($9,338 + $11,550)/2] = 5.6145 timesInventory period = 365/5.6145 = 65.01 daysReceivables turnover = $82,544/[($5,670 + $6,947)/2] = 13.0846 timesReceivables period = 365/13.0846 = 27.9 daysPayables turnover = $58,638/[($7,689 + $9,625)/2] = 6.7735 timesPayables period = 365/6.7735 = 53.89 daysCash cycle = 65.01 + 27.9 - 53.89 = 39.0 days

Consider the Following Financial Statement Information for the Bulldog Icers