The Fried Green Tomatoes Restaurant increased its operating cycle from 67 days to 71 days while the cash cycle decreased by 2 days.How have these changes affected the accounts payable period?

Question

Quizplus · Accepted Answer

The operating cycle increased by 4 days (71 - 67), while the cash cycle decreased by 2 days. The accounts payable period is the difference between the operating cycle and the cash cycle. Therefore, the accounts payable period must have increased by 6 days (4 + 2).

The Fried Green Tomatoes Restaurant Increased Its Operating Cycle from 67