Newcastle Ltd manufactures and sells umbrellas in Australia. Their inventory turnover is 7 times. Their accounts receivable turnover is at 38 days. Non-current assets are $580,000. Newcastle Ltd has no non-current liabilities. Current assets are $320,000, which includes cash of $155,000. The current ratio is 2. Current liabilities include accounts payable and notes payable of $35,000. The income statement records sales of $700,000, COGS of $400,000 and operating expenses of $60,000. Required:

1. What is Newcastle Ltds Cash Conversion Cycle?
2. Explain in your own words the meaning of this Cash Conversion Cycle .
3. Provide two suggestions of how this company can improve their Cash Conversion Cycle?
4. Calculate the Return on Assets for Newcastle Ltd?
5. Calculate the Return on Equity for the Newcastle Ltd?
6. If the accounts receivables turnover is at 7.5 times, what is the impact on Return on Assets?