The Biratnagar Biscuit Factory has an inventory turnover of 2.4 times, a receivables collection period of 76 days and a payable deferral period of 60 days. Assume 360 days per year.
(a) What is the length of the firm’s cash conversion cycle ?
(b) If the company’s annual sales are Rs. 6.75 Millions and 80% sales are on credit, what is the firm’s investment in account receivables?
(c) How many times per year does the company turn over its inventory?