The Following Analysis Is Based on Information Obtained from the 2017

question 34

Essay

The following analysis is based on information obtained from the 2017 financial statements of Pacific Company,River Corporation,and Ocean Company.
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$$\begin{array} { l r r r } \text { (in millions) } & \text { Pacific } & \text { River } & \text { Ocean } \\\text { Accounts receivable turnover ratio } & 10.7 & 18.9 & 12.1 \\\text { Inventory turnover ratio } & 9.1 & 18.4 & 6.4\end{array}$$ A) Compute the cash-to-cash operating cycle for each company for 2017 .
B) What does this ratio measure? Which company has the better cash-to-cash operating cycle?

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Definitions:

National Debt

The overall quantity of money that a country's ruling body has procured as loans from diverse origins.

Federal Revenue

The total income received by the government from taxes and other sources.

Corporate Income Tax

A tax on the profits of corporations, calculated based on the net income companies report.

Payroll Tax

Levies placed on either employees or employers, often determined as a percentage of the wages that staff receive from employers.