You are a management accountant working at Riverside Ltd, a company that manufactures and distributes a range of travel clothes and bags for many years in the US. Riverside Ltd sells travel clothes and bags in the USA domestically and exports the goods worldwide In order to reduce holding and ordering cost, Riverside Lts uses economic order quantity. However, the holding and ordering cost of raw material is relatively high for Riverside Ltd. All materials are paid for in cash at the time of purchase. Production staff are paid their wages daily in cash. All other overheads, production, and sales, are on credit. All sales are credit sales. You have estimated the figures below for the coming year. Sales $15,500,000 Average receivable $3,800,000 Materials purchases $10,500,000 Production staff wages $3,500,000 Other production overheads $2,050,000 Sales overheads $1,050,000 Average stocks: Finished goods $2,750,000 Work in progress $2,650,000 Raw materials $1,950,000 Average payables $1,000,000 

Required: A. Calculate the cash operating cycle. 

B. As a management accountant of Riverside Ltd, write what is Just-in-time (JIT)

Answer rating: 100% (QA)

A To calculate the cash operating cycle we can use the formula Cash Operating Cycle Days Inventory O... View the full answer