标题: FSA: sample exam: q22: Ready Power Inc. [打印本页]

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作者: former    时间: 2011-7-13 13:13     标题: FSA: sample exam: q22: Ready Power Inc.

q22, what is DOH? periodic or a perpetual counting system?
what is cash conversion cycle? Thanks.

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作者: yospaghetti    时间: 2011-7-13 13:13

DOH = Days of Inventory on hand

= 365/Inventory Turnover

= 365/ (COGS/Avg Inventory)

Perpetual counting system is an inventory cost flow method. Instead of valuin ginventory at year end (under FIFO or LIFO), it is constantly updated.

Cash Conversion cycle is = Days Sales Outstanding + Days inventory on hand - Days of payables

=365/AR Turnover + 365/Inventory Durnover - 365/Payables turnover

= 365/ (sales/avg receivables) + 365/(COGS/avg inventory) - 365/(purchases/avg payables).


Going back to LI, does anyone remember the difference between Cossh conversion and operating cycle? is operating cycle just DSO + DOH?

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作者: ap0258    时间: 2011-7-13 13:13

We need to know this?

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作者: senlinlang    时间: 2011-7-13 13:13

I have no idea. I was just answering the question haha.

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