Your company's operating cycle provides a gauge of how long it has cash tied up in operations, which is why it's also commonly referred to as the cash conversion cycle. The operating cycle is a rough ...

A company's operating cycle, or cash conversion cycle, shows the length of time it takes a company to buy inventory, convert it into sales and collect the "accounts receivable" revenue from the sales.

Failure to manage working capital leads a firm into bankruptcy. Operating Cycle (OC) is a tool that helps firms avoid such trouble. Let us look at the computation of OC along with its inference rule.