Negus Enterprises has an inventory conversion period of 50 days, an aver- age collection period of 35 days, and a payables deferral period of 25 days. Assume that cost of goods sold is 80% of sales.
a. What is the length of the firm’s cash conversion cycle?
b. If Negus’ annual sales are $4,380,000 and all sales are on credit, what is the firm’s investment in accounts receivable?
c. How many times per year does Negus Enterprises turn over its inventory?