What is the implication of a negative cash cycle

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Question - Following is the ABC Ltd's data for the FY 2019-20.

(a) Cost of Goods Sold = Rs 18,00,000

(b) Cost of Production = Rs 15,00,000

(c) Raw Material consumed during year = Rs 16,00,000

(d) Average Finished Goods = Rs 1,40,000

(e) Average Work-in-process = Rs 1,30,000

(f) Average Raw material = Rs 1,50,000

(g) Average Debtors = Rs 1,20,000

(h) Average Creditors = Rs 1,50,000

(i) Annual Sales(on credit) = Rs 11,60,000

Assume 360 days in a year.

(1) Find the Gross Operating Cycle and Net Operating Cycle.

(2) How companies can reduce its cash cycle?

(3) What is the implication of a negative cash cycle?

Reference no: EM132856311

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