Zervos Inc

question 32

Multiple Choice

Zervos Inc. had the following data for 2008 (in millions) . The new CFO believes (1) that an improved inventory management system could lower the average inventory by $4,000, (2) that improvements in the credit department could reduce receivables by $2,000, and (3) that the purchasing department could negotiate better credit terms and thereby increase accounts payable by $2,000. Furthermore, she thinks that these changes would not affect either sales or the costs of goods sold. If these changes were made, by how many days would the cash conversion cycle be lowered?

• A) 34.0
• B) 37.4
• C) 41.2
• D) 45.3
• E) 49.8

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Definitions:

pH

A scale used to specify the acidity or alkalinity of an aqueous solution, with values ranging from 0 (very acidic) to 14 (very basic).

Capillary Action

Capillary action is the ability of a liquid to flow through narrow spaces without the assistance of, or even in opposition to, external forces like gravity, observed in phenomena such as water moving up a plant stem.

Adhesion

Adhesion refers to the process by which cells or substances stick to each other or to surfaces, playing a crucial role in many biological functions and processes.

Cohesion

The phenomenon where similar molecules are drawn to each other, resulting in them sticking together due to their mutual attraction.