Question

Information; Gross operating cycle = 80 days; Net operating cycle = 55days; Raw material storage period = 40 days; Conversion period = 2 days; Finished goods storage period = 20 days, The average collection period is

 A) 87 days

 B) - 37 days

 C) 7 days

 D) 18 days​

Answer 1

I hope 7 days..........

Answer 2

The average collection period is 18 days

Explanation:

The average collection period is the amount of time it takes for a business to receive payments owed by its clients in terms of account receivables.

average collection period = Gross operating cycle - (Raw material storage

                          period + Conversion period + Finished goods storage period)

                                        = 80 - (40 +2 +20)

                                         = 18