Working capital managementthe chickman corporation has an

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Working Capital Management

The Chickman Corporation has an inventory conversion period of 60 days, a receivables collection period of 30 days, and a payables deferral period of 30 days.  Its annual credit sales are $6,000,000, and its annual cost of goods sold (COGS) is 60% of sales.

a.  What is the length of the firm's cash conversion cycle?

b.  What is the firm's investment in accounts receivable?

c.  What is the company's inventory turnover ratio?

d.  Identify three ways in which the company could  reduce its cash conversion cycle?  What are the possible risks of reducing it?

Reference no: EM13380711

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