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A Firm Purchased Raw Materials on Account and Paid for Them

question 279

Multiple Choice

A firm purchased raw materials on account and paid for them within 30 days. The raw materials were used in manufacturing a finished good sold on account 100 days after the raw materials were purchased. The customer paid for the finished good 60 days later. The firm's cash conversion cycle is ________ days.


Definitions:

Dividend Yield

A financial metric that compares a company's annual dividend payments to its stock price.

Shares

Units of ownership interest in a corporation or financial asset, providing a portion of the ownership to the shareholder.

Geometric Average

The average rate of return for a set of values calculated by multiplying them together and then taking the nth root (where n is the total number of values).

Arithmetic Average

A calculated central value of a set of numbers by adding all numbers and dividing by the count of numbers.

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