Question : Changes in the Operating Cycle
Indicate the effect that the following will have on the operating cycle. Use the letter I to indicate an increase, the letter D for a decrease, and the letter N for no change:
a. Average receivables goes up.
b. Credit repayments times for customers are increased.
c. Inventory turnover foes from 3 times to 6 times.
d. Payable turnover goes from 6 times to 11 times.
e. Receivables turnover goes from 7 times to 9 times.
f. Payments to suppliers are accelerated.