The current assets and current liabilities of ANGLIA LTD at the end of March $2023$ are as

follows:

For the year ending ${31}^{st}$ March $2023,$ ANGLIA LTD had domestic and foreign sales of $$40$

million, all on credit, while cost of sales was $$26$ million. Trade payables related to both

domestic and foreign suppliers.

For the year ending ${31}^{st}$ March $2024,$ ANGLIA LTD has forecast that credit sales will remain

at $$40$ million while cost of sales will fall to $60\%$ of sales. The company expects current assets

to consist of inventory and trade receivables, and current liabilities to consist of trade payables

and the company's overdraft.

ANGLIA LTD also plans to achieve the following target working capital ratio values for the year

ending ${31}^{st}$ March $2024$:

Required:

A$.$ Calculate the working capital cycle $($cash collection cycle$)$ of ANGLIA LTD as at ${31}^{st}$ March

$2023$ and discuss whether a working capital cycle should be positive or negative.

$(6$ marks$)$

B$.$ Calculate the target quick ratio $($acid test ratio$)$ and the target ratio of sales to net working

capital of ANGLIA LTD as at ${31}^{st}$ March $2024.$

$(5$ marks$)$

C$.$ Analyse and compare the current asset and current liability positions for March $2023$ and

March $2024$ and discuss how the working capital financing policy of ANGLIA LTD would

have changed.

$(8$ marks$)$

D$.$ Briefly discuss THREE internal methods which could be used by ANGLIA LTD to manage

foreign currency transaction risk arising from its continuing business activities.

$(6$ marks$)$