JAMAMA LTD is a local manufacturing entity that produces popular consumer products. The company has been in the manufacturing sector for over 15 years and has significant market share in the sector. In the recent past the company has been facing some challenges relating to investment in working capital.

During a recent management meeting, asthe Finance Manager you were tasked to explain theimportance of investment in current assets or working capital.You thoroughly explained the importance of investing in each of the key elements of working capital . In summary,you emphasized that the investment in working capital is critical because of its impact on the day -to- day operations of any entity.

REQUIRED:

(a ) Justify the importance of working in any entity

( b) Explain the three major policies that can be pursued in working capital management (WCM)

(C ) The following details were extracted from the financial statements of the company for the year ended 31 March 2019 :

i. Opening inventory (1/ 04 / 18 ) - K 370000

ii. Annual Sales - K 20 900 000

iii. Annual Purchases- K 16200000

iv. Year end Trade Debtors ( 31/03 / 19 ) - K2900 000

v. Year end Trade Creditors ( 31 / 03 / 19 )- K3600000

vi. Closing inventory ( 31/03/19) - K 1570 000:

Using the relevant ratios , calculate the length of the Cash Operating Cycle or Working Capital Cycle in days .