5 Whitson Co. is looking for ways to shorten its cash conversion cycle. It has annual...

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5 Whitson Co. is looking for ways to shorten its cash conversioncycle. It has annual sales of $45,625,000, or $125,000 a day on a365-day basis. The firm's cost of goods sold is 70% of sales. Onaverage, the company has $7,500,000 in inventory, $5,750,000 inaccounts receivable, and $2,750,000 in accounts payable. Its CFOhas proposed new policies that would result in a 25% reduction inboth average inventories and accounts receivable, and a 10%increase in average accounts payable. She also anticipates thatthese policies would reduce sales by 5%. What effect would thesepolicies have on the company's cash conversion cycle? Enter youranswer rounded to two decimal places. For example, if your answeris 12.345 then enter as 12.35 in the answer box.

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5 Whitson Co. is looking for ways to shorten its cash conversioncycle. It has annual sales of $45,625,000, or $125,000 a day on a365-day basis. The firm's cost of goods sold is 70% of sales. Onaverage, the company has $7,500,000 in inventory, $5,750,000 inaccounts receivable, and $2,750,000 in accounts payable. Its CFOhas proposed new policies that would result in a 25% reduction inboth average inventories and accounts receivable, and a 10%increase in average accounts payable. She also anticipates thatthese policies would reduce sales by 5%. What effect would thesepolicies have on the company's cash conversion cycle? Enter youranswer rounded to two decimal places. For example, if your answeris 12.345 then enter as 12.35 in the answer box.