A Firm Is Considering the Following Changes: Increasing Inventory Variety

question 8

Essay

A firm is considering the following changes: increasing inventory variety which will increase average inventory by $10,000, and offering more liberal sales terms which will result in average receivables increasing to $65,000.These actions are expected to increase sales to $800,000 per year, and cost of goods will remain at 75%.Because of the increased purchases, average payables will increase to $35,000.What effect will these changes have on the cash conversion cycle?

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Definitions:

Genetic Markers

Specific sequences of DNA or RNA that can be used to identify individuals or species and are often used to study the relationship between an inherited disease and its genetic cause.

Extended Families

A family structure that goes beyond the nuclear family, including relatives such as grandparents, aunts, uncles, and cousins, often living close to or with each other.

General Population

The total group of individuals in a particular area or country, excluding specific subgroups selected for analysis or research.

Panic Attacks

Sudden episodes of intense fear or discomfort, which may include symptoms like palpitations, sweating, or feelings of losing control.