A Firm's Inventory and Accounts Payable Periods Are 80 and 42

question 65

Multiple Choice

A firm's inventory and accounts payable periods are 80 and 42 days respectively.How long can the firm's receivables period be in order to have no longer than a 65 day cash conversion cycle?

• A)27 days
• B)38 days
• C)57 days
• D)103 days cash conversion cycle = inventory period + receivable period - accounts payable period
• 65 \(\ge\) 80 days + receivables period - 42 days

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