IMPACT OF CASH CONVERSION CYCLE AND PROFITABILITY OF SELECTED CHEMICAL AND PAINT FIRM IN NIGERIA

Subscribe to access this work and thousands more

Abstract: This study investigated the impact of cash conversion cycle on profitability of selected chemical and paint firms in Nigerian for the period, 2000-2013. Adopting the (CCC)cash conversion cycle (accounts collection period plus inventory conversion period minus accounts payable period) as independent variable and gross operating profit as dependent variable and controlling for liquidity, financial assets to total assets (FATA), SIZE and leverage (DR), the study revealed that cash conversion cycle of selected chemical and paint firms in Nigerian has a positive though nonsignificant impact on profitability and thus implies that, either longer or shorter, it take the companies to sell their inventories, has no influence on profitability. In order words, the period between the expenditure for the purchases of raw
materials and the collection of sales from finished goods has no impact on the profitability of sampled chemical and paint firms in Nigeria. This suggests that, though longer CCC is good for explaining the financial success of selected chemical and paint firms in Nigeria, it is not a critical factor to consider when taking decision to improve profitability. The result also revealed that financial asset to total assets as a control variable has a significant positive impact on value and profitability of the sampled firms. This means, that increasing in the level of financial assets to total assets will lead to increase in the profitability and value of the sampled firms, since the financial assets are brought in for profitability purpose.

Subscribe to access this work and thousands more
Save
Need help with your academic research project/paper, technical or creative writing? Hire our expert researchers and writers. Click Here to Submit a Writing Request
Overall Rating

0

5 Star
(0)
4 Star
(0)
3 Star
(0)
2 Star
(0)
1 Star
(0)
APA

Hubs, H., Bassey, E & Chizoba, O (2021). IMPACT OF CASH CONVERSION CYCLE AND PROFITABILITY OF SELECTED CHEMICAL AND PAINT FIRM IN NIGERIA. Afribary. Retrieved from https://afribary.com/works/impact-of-cash-conversion-cycle-and-profitability-of-selected-chemical-and-paint-firm-in-nigeria

MLA 8th

Hubs, Hkay, et. al. "IMPACT OF CASH CONVERSION CYCLE AND PROFITABILITY OF SELECTED CHEMICAL AND PAINT FIRM IN NIGERIA" Afribary. Afribary, 28 Dec. 2021, https://afribary.com/works/impact-of-cash-conversion-cycle-and-profitability-of-selected-chemical-and-paint-firm-in-nigeria. Accessed 21 Jan. 2022.

MLA7

Hubs, Hkay, Ewah Bassey and Onyimba Chizoba . "IMPACT OF CASH CONVERSION CYCLE AND PROFITABILITY OF SELECTED CHEMICAL AND PAINT FIRM IN NIGERIA". Afribary, Afribary, 28 Dec. 2021. Web. 21 Jan. 2022. < https://afribary.com/works/impact-of-cash-conversion-cycle-and-profitability-of-selected-chemical-and-paint-firm-in-nigeria >.

Chicago

Hubs, Hkay, Ewah Bassey and Onyimba Chizoba . "IMPACT OF CASH CONVERSION CYCLE AND PROFITABILITY OF SELECTED CHEMICAL AND PAINT FIRM IN NIGERIA" Afribary (2021). Accessed January 21, 2022. https://afribary.com/works/impact-of-cash-conversion-cycle-and-profitability-of-selected-chemical-and-paint-firm-in-nigeria