27.7 Indicate whether the following company actions increase, decrease, or cause no change to the cash cycle

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27.7 Indicate whether the following company actions increase, decrease, or cause no change to the cash cycle and the operating cycle.

a. The use of discounts offered by suppliers is decreased.

b. More finished goods are being produced for orders instead of for inventory.

c. A greater percentage of raw materials purchases is paid for with cash.

d. The terms of discounts offered to customers are made more favorable for the customers.

e. A larger than usual amount of raw materials is purchased as a result of a price decline.

f. An increased number of customers pays with cash instead of credit.

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Corporate Finance

ISBN: 9780071229036

6th International Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe

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