Last month, BlueSky Airline announced that it would stretch out its bill payments to 45 days from

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Last month, BlueSky Airline announced that it would stretch out its bill payments to 45 days from 30 days. The reason given was that the company wanted to “control costs and optimize cash flow.” The increased payables period will be in effect for all of the company’s 4,000 suppliers.


What impact did this change in payables policy have on BlueSky’s operating cycle? Its cash cycle?

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Corporate Finance

ISBN: 9781265533199

13th International Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

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