Attempts: Keep the Highest: /6 5. Cash conversion cycle Cash management is very important function of managers. Companies need t manage their operations in a way that they can sustain growth and yet not run out of cash. Consider the case f the Loud Noise Recordings' Corporation: Loud Noise Recordings' Corporation has forecasted sales of $24,000,000 for next year and expects its cost of goods sold (COGS) to remain at 80% of sales. Currently, the firm holds $3,200,000 inventories, $1,900,000 in accounts receivable, and $2,700,000 in accounts pavable. Approximately how long does it take Loud Noise Recordings' to convert its raw materials its finished products and then to sell those goods? (Note: In all calculations, assume that there are 365 days In a year.) SSRN-id1464471.pdf Chapter12.pdf Chapter 13.pdf 60.83 days 66.91 days 63.87 days 45.62 days A-Z from the time a sale is made until the time cash is collected from customers. On average, it takes Loud Noise Recordings' relies on customer credit when it buys raw materials from its suppliers. On average, it takes after the firm purchases materials before it sends cash suppliers. What the length of Loud Noise's cash conversion cycle (CCC)? 46.08 days 38.40 days 48.00 days e Chapter12.pdf Chapter 13.pdf SSRN-id1464471.pdf What is the length of Loud Noise's cash conversion cycle (CCC)? 46.08 days 38.40 days A- 48.00 days 34.56 days The management at Loud Noise Recordings' wants to continue its internal discussions regardinq its cash management. One of the finance team members presents the following case her cohorts: Case in Discussion Hungry Whale Electronics Company's management plans to finance its operations with bank loans that will be repaid as soon as cash is avalable. The company's management expects that it will take 60 days to manufacture and sell ts products and 50 days to recelve payment from its customers. Hungry Whale Electronics Company's CFO has told the rest of the management team that they should expect the lenqth of the bank loans to be approximately 110 days. Chapter 13,pdf e SSRN-id1464471.pdf Chapter12.pdf Which of the following responses to the CFO's statement most accurate? The CFO's approximation of the length of the bank loans should be accurate, because it will take 110 days for the company to manufacture, sell, and collect cash for its goods. All these things must occur for the company to be able to repay its loans from the bank The CFO is not taking into account the amount of time the company has to pay its suppliers. Generally, there is a certain length of time between the purchase of materials and labor and the payment of cash for them. The CFO can reduce the estimated length of the bank loan by this amount time. posslble for a firm to have a neqatlve CcC? Is No Yes ( Grade It Now Save& Continue Continue without saving SSRN-id1464471.pdf Chapter12.pdf Chapter 13.pdf