Question

What are some tools that companies have to manage their (net operating) working capital? Provide examples of inventory and receivables management techniques. What is the Cash Conversion Cycle and why is this a useful metric? Are there risks if this is too low?

Solution Preview

This material may consist of step-by-step explanations on how to solve a problem or examples of proper writing, including the use of citations, references, bibliographies, and formatting. This material is made available for the sole purpose of studying and learning - misuse is strictly forbidden.

There are several tools which can be used to manage different components of working capital. The intersection of carrying costs and shortage costs can be used to determine the level of optimal inventory. The working capital financing policy and cash budgeting strategies can be used to manage cash. The tools of Economic Order Quantity (EOQ) and Just In Time Inventory (JIT) can be used to manage inventory levels. The cash discount offered to...

This is only a preview of the solution. Please use the purchase button to see the entire solution

$10.00

or free if you
register a new account!

Related Homework Solutions

Finance Questions
Homework Solution
$50.00
Business
Finance
Company
Expand
Operation
Building
Debt
Capital
Structure
Dividend
Income
Finance Questions
Homework Solution
$65.00
Business
Finance
Shares
SELE
Gain
Loss
Stock
Profit
Black Scholes OPM
Dividend
Striking Price
Treasury Bills
Volatility
Risk Adjusted Performance
Rate
Return
Contract
Soybeans
Oil
Revenue Forecast
Homework Solution
$13.00
Business
Finance
Revenue
Forecast
Best
Worst
Case
Physician
Procedures
Finance Questions
Homework Solution
$15.00
Business
Finance
Company
Equipment
Break
Even
Quantity
Discount
Rate
Depreciation
Investment
Sale
Cost
Tax
Market
Equity
Beta
T-Bond
Risk
CAPM
Return
WACC
Get help from a qualified tutor
Live Chats