The following financial information (excerpted) are from the annual reports of Jack and Jim Inc.:

In $ Thousands
Income Statement	20Y1	20Y2	20Y0
Sales	26,560	22,920	20,650
COGS	15,700	14,100	13,800
Gross Profit	10,860	8,820	6,850
Net income	5,950	4,840	3,560
Balance Sheet
Accounts receivable	5,120	5,280	5,100
Inventory	2850	2930	2970
Accounts payables	2,800	2,260	2,100

Required:

a) Calculate the followings:

Ratios	Formula
1. Gross profit margin for 20Y2, 20Y1 and 20Y0.	Gross profit margin = Gross profit / Revenue
2. Days Sales outstanding (DSO) for 20Y2 and 20Y1.	DSO = 365 * Average Receivables / Sales
Improvement in DSO
Cash saving = Sales per day * improvement
2. Days inventory outstanding (DIO) for 20Y2 and 20Y1.	DIO = 365 * Average inventory / COGS
Improvement in DIO
Cash saving = COGS per day * improvement
3. Days payables outstanding (DPO) for 20Y2 and 20Y1.	DPO = 365 * Average payables / COGS
Improvement in DPO
Cash saving = COGS per day * improvement
4. Cash conversion cycle (CCC) for for 20Y2 and 20Y1.	CCC = DSO + DIO - DPO
Improvement in CCC
5. Total Cash savings

Show your working

b) Discuss how cash conversion cycle is impacted by DSO, DPO and DIO.