If it takes Diamondback Enterprises 90 days to sell inventory,46 days to collect from the sale,and creditors' payment terms are 60 days,the financing period is
A)196 days.
B)46 days.
C)90 days.
D)76 days.

Question

Quizplus · Accepted Answer

The financing period is the time it takes for Diamondback Enterprises to receive payment from its customers after it has paid its suppliers. It can be calculated by adding the collection period (46 days) and the inventory period (90 days) and then subtracting the payment period (60 days). 
Financing period = Collection period + Inventory period - Payment period 
= 46 + 90 - 60 
= 76 days 
Therefore, the financing period is 76 days, which is option D.

If It Takes Diamondback Enterprises 90 Days to Sell Inventory,46