Calculate bb current cash conversion cycle

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Question - Bracelet Blanks, Inc. (BB) generated $43,803,000 in sales (all on credit) during 2010. Cost of goods sold was 57% of that total. Accounts receivable was $3,240,222, inventory was $842,020, and accounts payable was $1,826,070.

Required -

1. Calculate BB's current cash conversion cycle.

2. BB currently uses 3,000 aluminum ingots a year to produce bracelet boards. The order cost (including shipping) is $5,000 per order, and annual inventory carrying costs are $75 per unit. Determine the economic order quantity, the safety stock quantity, and the reorder point for the aluminum ingots assuming that there is a one-week lead time and that the company wants to have a 3% safety stock.

Reference no: EM133160162

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