Financial Ratios
Cash Conversion Cycle
Definition
What is Cash Conversion Cycle?
Inventory days plus receivable days minus payable days.
Example in practice
How This Looks in Practice
The company holds inventory 40 days, collects in 30 days, and pays in 20 days, giving a 50-day cycle.
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Related Terms
Financial Ratios
Gross Margin
Gross profit expressed as a percentage of revenue.
Financial RatiosOperating Margin
Operating profit expressed as a percentage of revenue.
Financial RatiosEBITDA Margin
EBITDA expressed as a percentage of revenue.
Equity ValuationEarnings Per Share
Net income attributable to ordinary shareholders divided by weighted average ordinary shares.