FINANCIAL MANAGEMENT

Question 1 - Working Capital [10 marks} - BuyRight [Pty] Ltd is a supermarket group tIading throughout South Africa, with the following current assets and current liabilities at Dec 2019 Current Assets Inventory Accounts Receivable Current Liabilities Short Term Loan Accounts payable Taxation - BuyRight achieved sales of R1316m for 219. - Purchases [COGS] for 211119 was RIUBG. Question 1 [a] - Calculate the 2&19 cash conversion cycle for Buy-Right. Question 1 lb] - Assume that BuyRight decided to improve it' s cash conversion cycle by decreasing it's inventory conversion days to 6D. The company also outsourced the collection of its accounts receivable book to an independent 31'd party, which resulted in an a new collection period of 30 days. Calculate the EAR effect of the net cash ow to the company. Question 1 lcl - Assume that sales for ZDZD is expected to grow at just over 2% to reach R158m. Assuming that the cash conversion cycle remains constant for 2-320, would Buy-right have sufcient working capital to fund the envisaged sales for 22