Assume you have extracted the following information from the statements of Manzini Manufacturing Ltd. (MML) for...

 

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Assume you have extracted the following information from the statements of Manzini Manufacturing Ltd. (MML) for the financial year to 28 February 2022. Assume a 365 day year. R'000 Inventory: Raw material (RM) 300 Work in process (WIP) 520 Finished Goods (FG) 430 Total inventory 1250 Trade receivables 620 Trade payables 220 Purchases (only raw material) 3800 Cost of goods sold 5100 Sales 9900 REQUIRED (a) Calculate the Cash Conversion Cycle (CCC), also known as the Net working Capital (NWC) cycle or the number of days this company needs financing for. (12) (b) Also advise management how the management of the CCC can contribute to increasing the profitability of the company. (3) Assume you have extracted the following information from the statements of Manzini Manufacturing Ltd. (MML) for the financial year to 28 February 2022. Assume a 365 day year. R'000 Inventory: Raw material (RM) 300 Work in process (WIP) 520 Finished Goods (FG) 430 Total inventory 1250 Trade receivables 620 Trade payables 220 Purchases (only raw material) 3800 Cost of goods sold 5100 Sales 9900 REQUIRED (a) Calculate the Cash Conversion Cycle (CCC), also known as the Net working Capital (NWC) cycle or the number of days this company needs financing for. (12) (b) Also advise management how the management of the CCC can contribute to increasing the profitability of the company. (3)