1. Basic concepts Aaa Aa During the wake of the financial crisis, Ben Bernanke, chairman of the Federal Reserve, said that shortening the cash cycle and better use of working capital" are the most important factors as private-sector businesses struggle to overcome the current economic volatility and difficulty in accessing capital markets (IBM Global Business Services, "Managing Working Capital in the New Economic Environment," http://www-935 ibm.com/services/uk/bcs/pdf/working capital paper.pdf) Considering how important working capital management is, Bellgotts Inc. decided to evaluate the amount of working capital being used in the firm and explore the prospects of how its working capital will be financed Bellgotts Inc. reported the following results for current assets and liabilities on its most recent balance sheets. Interestingly, the company's sales did not change reported sales of $11,100 for its most recent year as well as for the previous year The columns labelled "Ending ($)M show results at the end of the most recent year and the columns labelled "Beginning show results at the end of the previous year Beginning Ending Beginning Ending Current liabilities Current assets Cash 5,000 Accounts payable 2,600 4,800 4,900 4,000 Notes payable Accounts receivable 5,000 3,200 3,600 3,400 Accruals Inventory 3,900 Using the information given and a 365-day year, calculate days of working capital, net working capital, and net operating working capital for Bellgotts Inc. Use your calculations to complete the following statements: Bellgotts Inc.'s days of working capital improved from days in the previous year to days at the end of the most recent year The company's net working capital increased from $3,500.00 in the previous year to at the end of last year Bellgotts Inc.'s net operating working capital increased from in the previous year to $7,500.00 at the end of last year