Red Hamster Manufacturing Corporation has forecasted sales of $29,000,000 for next year and expects its cost of goods sold (COGS) to remain at 70% of sales. Currently, the firm holds $3,200,000 in inventories, $2,100,000 in accounts receivable, and $2,700,000 in accounts payable.

Approximately how long does it take Red Hamster Manufacturing to convert its raw materials to its finished products and then to sell those goods? (Note: Use 365 days as the length of a year in all calculations, and round all values to two decimal places.)

1. 63.29 days
2. 46.03 days
3. 57.54 days
4. 40.28 days

On average, it takes_________________from the time a sale is made until the time cash is collected from customers.

1. 30.39 days
2. 26.43 days
3. 22.47 days
4. 19.82 days

Red Hamster Manufacturing relies on customer credit when it buys raw materials from its suppliers. On average, it takes______________after the firm purchases materials before it sends cash to its suppliers.

1. 58.26 days
2. 48.55 days
3. 43.7 days
4. 38.84 days

The length of Red Hamster Manufacturings cash conversion cycle (CCC) is:

1. 30.11
2. 35.42

In general, the firm prefers a longer or shorter CCC.

What is the length of Red Hamster Manufacturings cash conversion cycle (CCC)?

1. 35.42 days
2. 44.28 days
3. 33.65 days
4. 30.11 days