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Green Melon Electronics Company is a mature firm that has a stable flow of business. The following data was taken from its financial statements last

Green Melon Electronics Company is a mature firm that has a stable flow of business. The following data was taken from its financial statements last year:
Annual sales $10,500,000
Cost of goods sold $7,875,000
Inventory $3,100,000
Accounts receivable $2,200,000
Accounts payable $2,700,000
Green Melons CFO is interested in determining the length of time funds are tied up in working capital. Use the information in the preceding table to answer the following questions. (Note: Use 365 days as the length of a year in all calculations, and round all values to two decimal places.)
What is the value of the inventory conversion period?
69.15 days
53.43 days
143.68 days
56.57 days
Both the inventory conversion period and payables deferral period use the average daily COGS in their denominators, whereas the average collection period uses average daily sales in its denominator. Why do these measures use different inputs?
Inventory and accounts payable are carried at cost on the balance sheet, whereas accounts receivable are recorded at the price at which goods are sold.
Current assets should be divided by sales, but current liabilities should be divided by the COGS.
What is the average collection period?
24.09 days
30.79 days
76.48 days
25.43 days
What is the payables deferral period?
52.01 days
65.70 days
125.14 days
57.49 days
What is the cash conversion cycle?
36.62 days
38.37 days
95.02 days
43.60 days

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