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Intuitively, you would say that supermarket chain Cold Storage has A) A very short cash cycle B) A very short cash cycle

Posted: Tue Apr 26, 2022 10:26 am
by answerhappygod
Intuitively, you would say that supermarket chain Cold Storage
has
A) A very short cash cycle
B) A very short cash cycle, possibly a negative one
C) It is not possible to say without more quantitative
information
D) A very long cash cycle
I am thinking of option A, Since the customer has to make
instant payment when they purchased daily essentials from the
supermarket?
And also due consideration is given such that when supermarkets
received the goods from suppliers they will be given a certain
period to make payment from the payment terms stated on the invoice
order?
Let me know if my analysis on cash cycle theory for this
scenario is correct or incorrect?
Thanks!