Answer:
Option (D) is correct.
Step-by-step explanation:
Given that,
Inventory conversion period = 50 days
Average collection period = 17 days
Payables deferral period = 25 days
Cash Conversion cycle:
= Inventory Conversion Period + Average collection Period - Payables deferral Period
= 50 days + 17 days - 25 days
= 42 days
Therefore, the firm's cash conversion cycle is 42 days.