Jerome Industries Has Inventory Days of 48, Accounts Receivable Days

question 86

Multiple Choice

Jerome Industries has inventory days of 48, accounts receivable days of 21, and accounts payable days of 30. What is its cash conversion cycle?

• A) 39 days
• B) 57 days
• C) 69 days
• D) 72 days

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Definitions:

Long-Term Debt

A financial obligation that is due for repayment in more than one year's time.

Ten-Year Treasury Note

A government debt security issued by the U.S. Treasury with a ten-year maturity, which pays interest to the holder every six months.

Cash Equivalent

Short-term, highly liquid investments that are easily convertible to known amounts of cash and close to their maturity.

Certificate of Deposit

A time deposit at a bank or financial institution that offers a fixed interest rate over a specified period.