Use the financial statements supplied below and on the shown below for International Motor Corporation (IMC) to answer the following questions:

a. Calculate the cash conversion cycle for IMC for both 2018 and 2019. What change has occurred, if any? All else being equal, how does this change affect IMC’s need for cash?
b. IMC’s suppliers offer terms of net 30. Does it appear that IMC is doing a good job of managing its accounts payable?

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Sales Cost of goods sold Income Statement (in millions) for the Years Ending December 31 2018 Gross profit Selling, general, and administrative expenses Operating profit Interest expense Earnings before taxes Taxes Earnings after taxes $60,000 52,000 $ 8,000 6,000 $ 2,000 1,400 $ 600 300 $ 300 2019 $ 75,000 61,000 $ 14,000 8,000 $ 6,000 1,300 $4,700 2,350 $2,350