You have recently been hired to improve the performance of Multiplex Corporation which has been experiencing a severe cash shortage. As part of your analysis, you want to determine the firm's cash conversion cycle. Using the following information and a 360-day year, what is your estimate of the firm's current cash conversion cycle?
Current inventory=$120,000
Annual sales=$600,000
Accounts receivable=$160,000
Accounts payable= $25,000
Total annual purchases= $360,000
Purchases credit terms: net 30 days
Receivables credit terms: net 50 days