You must provide the Managing Director with a report describing the constituents of working capital and an explanation of the working capital cycle. Illustrate using the ratios provided below and make recommendations on how to improve the working capital cycle for Tayshire Furnishings using ratio information provided to illustrate your report.

quick or acid test ratio Tayshire Furnishings 1.12:1, industry norm 0.95:1

debtor days Tayshire Furnishings 60 industry norm 45

creditor days Tayshire Furnishings 40, industry norm 30

stock turnover Tayshire Furnishings 8 times per annum, industry norm 5