XYZ Co. produces wires, which generally sits in the warehouse for 20 days. It typically takes...

 

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XYZ Co. produces wires, which generally sits in the warehouse for 20 days. It typically takes 30 days to collect on the sale of each wire, and that it takes 15 days to pay invoices to Company XYZ's vendors. What is Company XYZ's cash conversion cycle? Draw the cash flow cycle. Hint: The cash conversion cycle, also called the net operating cycle, is the number of days it takes a company to generate revenues with assets. Cash Conversion Cycle = Days Inventory Outstanding + Days Sales Outstanding - Days Payables Outstanding XYZ Co. produces wires, which generally sits in the warehouse for 20 days. It typically takes 30 days to collect on the sale of each wire, and that it takes 15 days to pay invoices to Company XYZ's vendors. What is Company XYZ's cash conversion cycle? Draw the cash flow cycle. Hint: The cash conversion cycle, also called the net operating cycle, is the number of days it takes a company to generate revenues with assets. Cash Conversion Cycle = Days Inventory Outstanding + Days Sales Outstanding - Days Payables Outstanding

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Cash conversion cycle CCC The cash conversion cycle CCC is the number of days it takes a company to convert its investments in inventory and other res... View the full answer