Below are financials for XYX Corporation (in million $):

Sales	$330		Cash	$ 6		Accounts Payable	$ 64
COGS	260		Accounts Receivable	72		Long term debt	119
SG&A	12		Inventory	40		Common stock	50
EBIT	58		Net fixed assets	241		Retained earnings	126
Interest	11		Total assets	$359		Total Equity & Liab.	$359
EBT	47
Tax	14
Net Income	$ 33

The firm's inventory conversion period is 56 days. Its new CFO wants to decrease the cash conversion cycle by 8 days, based on a 365-day year. He believes he can reduce average receivables by $2.7 million without upsetting customers.

a. By how much must the firm increase its average payable to meet its goal of a 8-day reduction in its cash conversion cycle? (6 points)

b. If XYZ Corporation does decrease its cash conversion cycle by 8 days by increasing average payables and reducing average receivables, what will be the change in its net operating working capital? The company's inventory remains constant. (2 points)