Cash conversion cycle Hurkin Manufacturing Company pays accounts payable on the tenth day after...

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Cash conversion cycle Hurkin Manufacturing Company pays accounts payable on the tenth day after purchase. The average collection period is 30 days, and the average age of inventory is 40 days. The firm currently has annual sales of about$18 million and purchases of $14 million. The firm is considering a plan that would stretch its accounts payable by 20 days. If the firm pays 12% per year for its resource investment, what annual savings can it realize by this plan? Assume a 360- day year. Oct 13 2014 10:01 AM

 

Solution ID:608829 | This paper was updated on 26-Nov-2015

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