Cash is King! The Cash Conversion Cycle is the process where cash is used to purchase inventory for retail, professional treatment products and operating supplies that are sold or consumed in a spa treatment. When the inventory is sold or used to provide a spa treatment, the investment moves from inventory to accounts receivable. Later, after a reasonable period of time, accounts receivable are collected and the spa will have cash again. A major objective of Cash Management is to operate a spa with less money in accounts receivables and inventories. The shorter the Cash Conversion Cycle the better, as this is a measure of the spa's liquidity. Before Lilly and Valeria go ahead and build the GAW Wishing Spa Cash Budget, they need to take a look at their Cash Conversion Cycle as they both know this will help them analyze the efficiency of their working capital. They remembered what Ray told them: "The management of your working capital is closely related to the management of your cash." Below is an example of a cash flow from the period of Monday, June 1, through Saturday, June 6 2020 of the GAW Wishing Spa. It demonstrates how cash flow and disbursements occur in this period. Guest treatments for that week accounts for 20,000 usd and consist of payments made in cash, debit and credit cards. Therapists and administrative net payroll for that same period is calculated as 7,000 usd and is paid on Thursday, June 11. Payroll taxes, retirement plan deferrals and other payroll related expenses account for 4,000 usd, and they are paid on Monday, June 15. Saturday, June 6: All cash and debit card payments are collected: Monday and Tuesday Visa/Master Card payments: Thursday, June 11: Remaining Visa/Master Card payments: $7,000 $4,000 $5,000 $16.000 ($7,000) Balance of Cash Net Payroll disbursement: Friday, June 12: Collection of American Express payments: $4,000 $13,000 Balance of Cash Monday, June 15: Other Payroll related expenses: ($4,000) Balance of Cash $9,000 For this assignment you are requested to build a Balance of Cash as shown above but for your own company or any other hypothetical spa. Please make sure you give enough details as to the period, payments collected, payroll expenses and other related payroll expenses. The Get-A-Well Wishing Spa From Monday, June 1st 2020 thru Saturday, June 6th 2020 Saturday, June 6: All cash and debit card payments are collected: Monday and Tuesday Visa/Master Card payments: $7,000 $4,000 Thursday, June 11: Remaining Visa/Master Card payments: $5,000 Balance of Cash $16,000 Net Payroll disbursement: $7,000 Friday, June 12: Collection of American Express payments: $4,000 Balance of Cash $13,000 Monday, June 15: Other Payroll related expenses: $4,000 Balance of Cash $9,000