Selected information from the income statement and balance sheet of Fraser River Adventures Ltd. (FRA) is as follows:
Sales ............................................................... $5,300,000
Percentage of credit sales ....................................... 80%
Cost of goods sold as a percentage of sales .................. 60%
Inventory, December 31, 2009 ................................. $500,000
Inventory, December 31, 2010 ................................. $800,000
Accounts receivable, December 31, 2010 ..................... $1,200,000
Accounts payable, December 31, 2010 ........................ $600,000
Credit purchases as a percentage of purchases ............... 90%
Required:
Calculate the length of the operating cash cycle for FRA.