What Is the Inventory Period for a Firm with an Annual

question 50

Multiple Choice

What is the inventory period for a firm with an annual cost of goods sold of $8 million, $1.5 million in inventory, and a cash conversion cycle of 75 days?

• A) 76.56 days
• B) 18.75 days
• C) 53.33 days
• D)68.44 days

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Definitions:

Simple Interest Rate

The percentage of interest calculated only on the principal amount, not on accrued interest.

Payments

Transfers of money from one party to another to fulfill a financial obligation.

Discounted

A reduction applied to a price or rate, lowering the original amount.

Simple Interest Rate

The percentage of the principal amount that is paid as interest for a specified period.