Which of the Following Measures the Average Time It Takes

question 39

Multiple Choice

Which of the following measures the average time it takes a firm to complete its operating cycle after deducting the days supported by trade credit and delayed payroll financing?

• A)sale-to-cash conversion period
• B)inventory-to-sale conversion period
• C)purchase-to-payment conversion period
• D)cash conversion cycle

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Definitions:

Independent

Not influenced or controlled by others; acting freely.

P(A|B)

The likelihood of event A happening provided that event B has taken place.

P(B|A)

The probability of event B occurring given that event A has already occurred.

P(A and B)

The probability of both event A and event B occurring in a combined manner.