The cash conversion cycle (CCC)is defined as
A)Inventory Days + Accounts Receivable Days + Accounts Payable Days.
B)Inventory Days + Accounts Payable Days - Accounts Receivable Days.
C)Inventory Days - Accounts Receivable Days - Accounts Payable Days.
D)Inventory Days + Accounts Receivable Days - Accounts Payable Days.

Question

Quizplus · Accepted Answer

The cash conversion cycle (CCC) is calculated by adding the inventory days and accounts receivable days, and then subtracting the accounts payable days. This measures the length of time it takes for a business to convert its resources (inventory) into cash. Therefore, the formula for calculating CCC is Inventory Days + Accounts Receivable Days - Accounts Payable Days.

The Cash Conversion Cycle (CCC)is Defined as