(Genting Berhad has annual sales of RM50,735,000, an average inventory level of RM15,012,000, and average accounts receivable of RM10,008,000. The firm's cost of goods sold is 85% of sales. The company makes all purchases on credit and has always paid on the 30th day. However, it now plans to take full advantage of trade credit and to pay its suppliers on the 40th day. The CFO also believes that sales can be maintained at the existing level but inventory can be lowered by RM1,946,000 and accounts receivable by RM2,000,000. Assuming a 365-day year,)

1. (How many days would the original cash conversion cycle?)

2. (How many days would the new cash conversion cycle (after the change of inventory and account receivable)?

3. (What will be the net change in the cash conversion cycle?

4. (Did the net change of the cash conversion cycle (iii) indicate the Genting Berhads CCC improved? Explain your answer.