MA$245.$

Explain the Company Operating Cycle and Management Strategy

Consider the operating cycle as depicted in Exhibit $2\mathrm{.}4$ to answer the following questions.

a$.$

Why might a company want to reduce its cash conversion cycle? $($

Hint

: Consider the $$nancial

statement implications of reducing the cash conversion cycle.$)$

b$.$

How might a company reduce its cash conversion cycle?

c$.$

Examine and discuss the potential impacts on

customers

and

suppliers

of taking the actions

identi$$ed in part

b

$.\backslash$