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Quipukamayoc
Print version ISSN 1560-9103On-line version ISSN 1609-8196
Abstract
DIAZ CUENCA, Patrick Ademir and RAMON MARTINEZ, Jesabel Jesús. Cash conversion cycle and its impact on the liquidity of an industrial company. Quipukamayoc [online]. 2021, vol.29, n.59, pp.43-53. Epub May 27, 2021. ISSN 1560-9103. http://dx.doi.org/10.15381/quipu.v29i59.20141.
Objective:
To establish the impact of the cash conversion cycle on the liquidity of the industrial company Damar G&L S.A.C of Lima, during 2016 to 2019.
Method:
The study presented a quantitative approach with a range of cross-sectional correlational, using a non-experimental design. The method used to collect the data was the documentary analysis. As the study population, this research used data from the accounting records of accounts receivable, inventories, and the company’s payable accounts, in which 48 financial monthly statements were structured.
Results:
The results show that there is a minimal non-significant relationship between the cash conversion cycle and liquidity (Rho = .075, p = .614) corresponding to the periods under study. Furthermore, the independent variable’s indicators, accounts receivable turnover period, inventory turnover period, and accounts payable turnover period, show a weak relationship (Rho = .201, -.267, .086) in the acid test, with a significance level greater than 5%.
Conclusion:
It is concluded that, during the 2016-2019 period of the company under review, the cash conversion cycle does not directly affect its liquidity.
Keywords : Cash cycle; liquidity; rotation; cash; company.