CTP · Question #484
(Topic 5) A manufacturing company is working to improve its cash conversion cycle. Factory production has increased over the last year to increase inventory levels. They have an and a days'…
Sign in or unlock CTP to reveal the answer and full explanation for question #484. The question stem and answer options stay visible for context.
Question
- (Topic 5)
A manufacturing company is working to improve its cash conversion cycle. Factory production has increased over the last year to increase inventory levels. They have an and a days’ receivable of60. It has started enforcing its net 30 terms and placed customers with balances outstanding more than 45 days on credit hold. As a result, the company collected receivables quicker but it suffered a 10% loss in sales. What can the company do to reduce its cash conversion cycle?
Options
- APay vendors in advance.
- BDecrease the days' payable.
- CExtend payables deferral period.
- DRevise credit policy to be more lenient.
Unlock CTP to see the answer
You've previewed enough free CTP questions. Unlock CTP for full answers, explanations, the timed quiz mode, progress tracking, and the master PDF. Question stem and options stay visible so you can still see what's on the exam.