The Butler-Huron Company’s balance sheet and income statement for last year are as follows:

Balance Sheet (in Millions of Dollars)
Assets Liabilities and Equity Cash and marketable securities $ 103 Accounts payable*** $1,166 Accounts receivable*** 1,138 Accrued liabilities Inventories***** 1,827 (salaries and benefits) 536 Other current assets 39 Other current liabilities 493 Total current assets $3,107 Total current liabilities $2,195 Plant and equipment (net) 3,523 Long-term debt and other Other assets 54 liabilities 2,736 Total assets $6,684 Common stock 105 Retained earnings 1,648 Total stockholders’ equity $1,753 Total liabilities and equity $6,684 *Assume that all sales are credit sales and that average accounts receivable are the same as ending accounts receivable.
**Assume that average inventory over the year was the same as ending inventory.
***Assume that average accounts payable are the same as ending accounts payable.
Income Statement (in Millions of Dollars)
Net sales $13,644 Cost of sales 9,890 Selling, general, and administrative expenses 2,264 Other expenses 812 Total expenses $12,966 Earnings before taxes 678 Taxes 268 Earnings after taxes (net income) $ 410 •a. Determine Butler-Huron’s cash conversion cycle.

b. Determine Butler-Huron’s cash conversion cycle assuming that 75 percent of annual sales are credit sales (i.e., 25 percent represent cash sales).

c. Determine Butler-Huron’s cash conversion cycle assuming that 50 percent of annual sales are credit sales. LO1