=20. Operating cycle: raw materials inventories = 15 days, length of production cycle = one month, inventories
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=20. Operating cycle: raw materials inventories = 15 days, length of production cycle = one month, inventories of finished products = 15 days. Payment terms: suppliers two months, customers one month, other costs paid in cash.
Assuming zero VAT, calculate working capital in days of sales. The production cycle lasts one month, which means that in-progress inventories represent one month of raw materials and 15 days of production costs.
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Related Book For
Corporate Finance Theory And Practice
ISBN: 9781118849330
4th Edition
Authors: Pierre Vernimmen, Pascal Quiry, Maurizio Dallocchio, Yann Le Fur, Antonio Salvi
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