Answered: Ammer Products has an average accounts…

Ammer Products has an average accounts payable balance of P850,000 and its annual net credit purchases is P8,750,000. Assume there are 365 days per year. What is Ammer’s payables deferral period?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.

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Ammer Products has an average accounts payable balance of P850,000 and its annual net credit purchases is P8,750,000. Assume there are 365 days per year. What is Ammer’s payables deferral period?

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