1. Raviolli Enterprise has an average age of accounts receivable is 45 days. The average age of accounts payable is 40 days and the average age of inventory is 69 days. Assuming a 365-day year, what is the length of its cash conversion cycle?

1. Raviolli Enterprise has an average age of accounts receivable is 45 days. The average age of accounts payable is 40 days and the average age of inventory is 69 days. Assuming a 365-day year, what is the length of its cash conversion cycle?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 3MC

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CASH MANAGEMENT
1. Raviolli Enterprise has an average age of accounts receivable is 45 days. The average
age of accounts payable is 40 days and the average age of inventory is 69 days.
Assuming a 365-day year, what is the length of its cash conversion cycle?

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1. What is the total present value of the cash receipts X today (at time 0) if interest is 4.4% payable quarterly?2. What is the total accumulated value of the cash receipts X right after the last payment (at time 10) if interest is 4.4% payable quarterly?3. What is the total interest earned at the end of the term of this cash flow?4. How much is the cash receivable X by Rafa at the end of each quarter at the same interest charged if its net present value is 50,000?5. Ken receives Y at the end of each semiannual period over the same term at 2.5% interest payable semiannually for this cash flow. Calculate Y if its total worth today is 50,000.6. For the previous problem who earned more based on the net value of their cash receipts at the end of the term? Ken or Rafa?