Question: Referencing readings in Ch2, what is the desirable period combination (days) and why? Note- there is no absolute right or wrong choice, we are testing your ability to apply the principles of the financial management (re: turn-overs and periods) and your financial management reasoning in that isolated topic.
Now consider this additional information when you make the choice: The firm's account's payable period (the firm's creditors due date for their deliveries) is 15 days.
a) Days Sale in Inventory 15, Days Sale in Receivable 30
b) Days Sale in Inventory 10, Days Sale in Receivable 35
c) Days Sale in Inventory 20, Days Sale in Receivable 25