3. Decompose the ratio of operating working capital to sales for ShipCo into operating-cash days, accounts-receivable days, inventory days, accountspayable days, and accrued-expenses days. (For comparability, use sales in all calculations.) Compare these results with those in Exhibit 10.14 for DefenseCo, a large diversified defense contractor. Which firm is showing a better trend in its management of its working capital?What might explain the differences in these variables?

EXHIBIT 10.14 DefenseCo: ROIC Decomposition Year 2 Year 3 Year 4 Year 5 Operating metrics ROIC, % 18.5 18.2 18.4 18.3 After-tax operating margin, % 7.1 6.9 7.0 6.9 Capital turns, times 2.62 2.65 2.63 2.64 Cost of sales/sales, % 73.0 73.1 72.8 72.9 SG&A/sales, % 14.4 14.6 14.7 14.7 Operating working capital/sales, % 3.1 2.9 3.1 3.1 PP&E/sales, % 35.1 34.9 34.9 34.8 Asset management, days Operating cash 7.1 7.1 7.1 7.1 Accounts receivable 42.1 41.8 42.7 42.5 Inventory 92.3 91.6 91.8 92.6 Operating current assets 141.5 140.5 141.6 142.2 Accounts payable 70.2 70.1 70.4 71.1 Accrued expenses 60.0 60.0 59.8 59.8 Operating current liabilities 130.2 130.1 130.2 130.9 Operating working capital 11.3 10.4 11.4 11.3