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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Cash operation cycle??
How an increase in the cash operating cycle will decrease
profitability?
Because an increase in the cycle will occur because of such things as taking longer to collect receivables and holding more inventories.
Both of these will increase interest costs (because either they will be borrowing money to finance the increase and paying interest, or because money will be tied up that could otherwise have been earning interest).
Thank you very much sir you are great
You are welcome 🙂