Question: Manitoba Services is considering undertaking a new order that would
Manitoba Services is considering undertaking a new order that would cause its average days of revenues in payables (ADRP) to decrease from 58 days to 45 days, while its average collection period (ACP) will remain at 90 days and its average days revenues in inventory (ADRI) will fall from 98 days to 80 days. What will be the effect on its operating cycle and cash cycle if these estimates are correct?
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