Question: Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate an increase, letter D for a decrease,
Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate an increase, letter D for a decrease, and the letter N for no change.
- Receivable average goes up.
- Credit repayment times for customers are increased.
- Inventory turnover goes from 3 times to 6 times.
- Payable turnover goes from 6 times to 11 times.
- Receivable turnover goes from 7 times to 9 times.
- Payments to suppliers are accelerated.
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