Scenario: Working Capital Management

Company H has the following working capital data:

• Accounts Receivable: $50,000
• Inventory: $30,000
• Accounts Payable: $20,000
• Sales: $200,000
• COGS: $100,000

Requirements:

1. Calculate the Cash Conversion Cycle (CCC).
2. Determine the Days Sales Outstanding (DSO).
3. Compute the Inventory Turnover Ratio.
4. Assess the impact on CCC if the company reduces its inventory by 20%.