Computing cash conversion cycle


Q1) Linear Technology had sales (all on credit) of $36 million and gross profit margin of 30% last year. If Linear Technology's inventory average $3.9 million, and its accounts receivable were $5.0 million, determine the length of its operating cycle?

Q2) If Swatch's inventory conversion period is 45 days, its payables deferral period is 35 days, and its receivables conversion period is 50 days, then its cash conversion cycle should be ________ days.

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Accounting Basics: Computing cash conversion cycle
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