Question: Will the following increase or decrease the cash cycle a. Customers are given a larger discount for cash transactions. b. The inventory turnover ratio falls
Will the following increase or decrease the cash cycle
a. Customers are given a larger discount for cash transactions.
b. The inventory turnover ratio falls from 8 to 6.
c. New technology streamlines the production process.
d. The firm adopts a policy of reducing outstanding accounts payable.
e. The firm starts producing more goods in response to customers’ advance orders instead of producing for inventory.
f. A temporary glut in the commodity market induces the firm to stock up on raw materials while prices are low.
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B is the correct answer The inventory turnover ratio falls from 8 to 6 Inventory Turn... View full answer
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