Amy runs a wholesale grocery business aiming to provide ingredients to local restaurants and hotels in Hunter Region area, and she hires an accountant to record the transactions for her business. Recently, the accountant gave her the following information for the business last year.

Sales revenue (all on credit)	$2,980,000
Cost of sales	$1,350,000
Average inventory	$750,000
Average account receivables	$795,000
Average account payables	$521,000
Non-current Assets	$750,000

Required:

1. Calculate the cash conversion cycle for the business.
2. What is the asset turnover and return on assets?
3. Advise Amy if she has a working capital problem in her business. If so, provide two (2) possible suggestions for her to address the issue.

Answer rating: 100% (QA)

Answer To solve this problem we need to calculate the cash conversion cycle asset turnover and return on assets and then provide advice on the working ... View the full answer