An analyst has recently been hired to improve the performance of SL Energy Corporation, which has been experiencing a severe cash shortage. As one part of your analysis, the analyst wants to determine the firm's cash conversion cycle. Using the following information and a 365-day year: Current inventory = $160,000; Annual sales = $1,095,000; Accounts receivable = $180,000; Accounts payable = $36,000; Total annual purchases = $730,000. Calculate the firm's inventory conversion cycle.

Calculate the firm's receivables collection period.

Calculate the firm's payables deferral period.

Calculate the firm's cash conversion cycle (CCC).

Answer rating: 100% (QA)

To calculate SL Energy Corporations inventory conversion cycle we use the formula Inventory conversion cycle Average inventory Cost of goods sold x 36... View the full answer