The following balances and turnover ratios for individual operating assets and operating liabilities have been calculated using end-of-year figures based on Kamloops Inc.s reformulated 2020 Balance Sheet:

Balance Turnover

Operating cash $ 150,000 26.67

Accounts receivable $ 250,000 16.00

Inventory $ 500,000 8.00

Property, plant & equipment $ 900,000 4.44

Accounts payable $ 275,000 14.55

Provisions $ 175,000 22.86

Net Operating Assets $1,350,000 2.96

Assuming that Kamloops operating profit margin after tax remains the same, what will happen to its RNOA if the Accounts Receivable turnover decreases to 15, the inventory turnover increases to 9, and the Accounts Payable turnover increases to 18?

	1.	Kamloops RNOA will decrease
	2.	Kamloops RNOA will increase
	3.	It is not possible to determine how the changes will affect Kamloops RNOA based on the information provided.
	4.	Kamloops RNOA will remain the same