Mark's Manufacturing's 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

Length of cash conversion cycle= 74 days

Explanation:

Cash conversion cycle is a measure of liquidity risk as a result of growth of a business. It considers how long a firm will be deprived of cash if it decides to increase amount it spends on inventory to expand customer sales.

CCC is how long a business takes to convert inventory to cash flow from sales.

Companies can shorten CCC by encouraging upfront payments and keeping repayment of credit less than 30 days.

CCC= Days of sales outstanding+ Days of inventory outstanding - Days of payables outstanding

CCC= 45+69-40

CCC= 74 days

1) the stages a new product goes through from beginning to end, i.e., the stages that a product passes through from introduction through growth, maturity, and decline. 2) the time from initial research and development to the time at which sales and support of the product to customers are withdrawn. 3) the period of time during which a product can be produced and marketed profitably.

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