Question: Indicate the effect that the following will have on the operating cycle. I = indicate an increase and D = a decrease or N =

Indicate the effect that the following will have on the operating cycle. I = indicate an increase and D = a decrease or N = no change.

Average receivables goes up

Credit repayment times for customers are increased

Inventory turnover goes down 3 times to 6 times

Payables turnover goes from 6 times to 11 times

Receivables turnover goes from 7 times to 9 times

Payments to suppliers are accelerated

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!