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Explain the Following Terms with Proper Example:  Cash Conversion Cycle - Entrepreneurship

Definition

Explain the following term with proper example:

 Cash conversion cycle

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Solution

(CCC or Operating Cycle) is the length of time between a firm’s purchase of inventory and the receipt of cash from accounts receivable. It is the time required for a business to turn purchases into cash receipts from customers.
CCC represents the number of days a firm’s cash remains tied up within the operations of the business.

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APPEARS IN

CBSE Class 12 Entrepreneurship Textbook
Chapter 5 Business Arithmetic
Very short answer (exceed 15 words) | Q 1.7 | Page 208
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