A Firm Can Reduce Its Cash Conversion Cycle by

question 92

Multiple Choice

A firm can reduce its cash conversion cycle by

• A)increasing its average age of inventory
• B)increasing its average collection period
• C)decreasing its average payment period
• D)increasing its average payment period
• E)none of the above

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Definitions:

Business Combination

A business combination occurs when two or more businesses merge or when one business acquires another, resulting in the consolidation of assets and liabilities under one entity.

Consolidated

Consolidated refers to the combined financial statements of a parent company and its subsidiaries, presenting the financial position and results of operations as if the group were a single entity.

Business Combination

A business combination is a transaction or event where an acquirer obtains control of one or more businesses, often in the form of mergers, acquisitions, or consolidations.

Diversification

An investment strategy aimed at reducing risk by allocating investments among various financial instruments, industries, or other categories.