You are a manager for a medium sized company and have been given the following information:

Your inventory turnover is 5

You have an average accounts receivable of $200,000 and sales of $1,500,000

Your average accounts payable is $60,000 and your cost of goods sold is $800,000.

(Show all work)

What is your inventory period?

Explain:

What is your accounts receivable period?

Explain:

What is your operating cycle?

Explain:

What is your accounts payable period?

Explain:

What is your cash conversion cycle?

Explain:

How could you improve your cycles?

If your daily average cost per day to run your business is $1,000, how much money do you need in your cash account to keep your business afloat?