In Order to Achieve a Negative Cash Conversion Cycle a Firm

question 8

Multiple Choice

In order to achieve a negative cash conversion cycle a firm would want to:

• A) increase its account payable period and its inventory turns.
• B) decrease its account payable period and its inventory turns.
• C) increase its account payable terms and decrease its inventory turns.
• D) decrease its account payable terms and increase its inventory turns.
• E) analyze systems and stop whatever processes are causing this, since a negative cash conversion cycle is associated with losses, not profits.