Question 19

Marks: 4

The ________ is the time period that elapses from the point when the firm makes the outlay to purchase raw materials on account to the point when payment is made to the supplier of the goods.

Choose one answer.

	a. cash conversion cycle
	b. average payment period
	c. average age of inventory
	d. average collection period
	e. none of the above

Question 20

Marks: 4

The ________ of a firm is the amount of time that elapses from the point when the firm makes an outlay to purchase raw materials to the point when cash is collected from bad debt.

Choose one answer.

	a. cash conversion cycle
	b. operating cycle
	c. average age of inventory
	d. average collection period
	e. none of the above

Question 21

Marks: 4

BP has an average age of inventory of 60 days, an average collection period of 45 days, and an average payment period of 30 days. Based on this information, BPs cash conversion cycle is ________ days.

Choose one answer.

	a. 25
	b. 35
	c. 45
	d. 55
	e. none of the above

Question 22

Marks: 4

A firm can reduce its cash conversion cycle by

Choose one answer.

	a. increasing its average age of inventory
	b. increasing its average collection period
	c. decreasing its average payment period
	d. none of the above

Question 23

Marks: 4

The goal of a company