If a Firm Has a Cash Cycle of 32 Days

question 28

Multiple Choice

If a firm has a cash cycle of 32 days and an operating cycle of 67 days, what is its payables turnover?

• A) 5.45
• B) 10.43
• C) 11.41
• D) 35

---

Definitions:

Variable Costs

Expenses that change in proportion to the level of production or sales activity, such as materials and direct labor.

Perishable Seats

Refers to seats in service industries (like airlines or event management) that cannot be sold after a certain time, leading to potential revenue loss.

Yield Management

A variable pricing strategy based on understanding, anticipating, and influencing consumer behavior to maximize revenue or profits, especially in airline and hotel industries.

Aggregate Planning

A process in operations management aimed at determining optimal production levels, inventory levels, and workforce levels, to meet predicted demand over a medium-term horizon.