solved Prior to beginning work on this discussion, read Chapter 16

Prior to beginning work on this discussion, read Chapter 16 of your textbook, and test your knowledge in the MindTap Practice Chapter 16 Problem 10 and Chapter 16 Problem 25 located in Ch 16: End-of-Chapter Problems. Although not required, it is recommended that you also review the chapter videos and flashcards available in the recommended resources section of your course.
Your chosen company is in the process of introducing a new product that will affect the firm’s working capital position. The director of finance has asked you to use the cash conversion cycle model, which focuses on the length of time between when the company makes a payment and when it receives cash inflows. The finance director provided the following instructions. As you complete your paper, ensure you show your work for all computations.
In your paper,

Compute the firm’s cash conversion efficiency trends using your chosen company’s most recent financial statements for the last three years (cash conversion efficiency = cash flow from operation / sales).
Summarize the various changes and directions of cash conversion efficient values or trends to least three of the chosen company competitors.
Compare and contrast cash conversion efficient values or trends to least three of the chosen company competitor
Highlight the possible reasons for the variances over the three years’ comparisons. (Show all computation work)
Determine the length of the firm’s (chosen company) current cash conversion cycle and three of its competitor’s current cash conversion cycles.
Describe the possible variations between the companies’ day’s inventory, day’s receivable, and day’s payables.

Your Director of Finance also wants to change the current firm’s cash conversion cycle to increase the firm’s cash flow to meet the needs of the proposed new product. You have been asked to provide some specific courses of action that the firm could consider to achieve its quantitative goals.

Calculate the following scenarios, ensuring you sure to show your work for all computations:

10% decrease in average inventory

Change the re-order point by replenishing more frequently
Aggressively moving out slow-moving or obsolete items
Change order size
Switching to just-in-time model for inventory management

15% decrease in account receivables

Change of terms of sale
Offer discount for early customer payments
Look at who company is granting credit to
More aggressive collection effort

10% increase in Account Payable

Segment suppliers/vendors between primary and secondary importance
Access suppliers where company has leverage over
Re-negotiate payment terms with suppliers

After completing the above computations,

Create a chart that demonstrates how these adjustments are working for your chosen company and how they are working for the competitors. (The chart should consist of the computations of both the cash conversion efficiency ratios as well as the cash conversion cycle.)
Summarize how these adjustments can make a difference on the total cash conversion cycle and cash conversion efficiency.

Note any similarities or variances from the competitors.

Describe the pros and cons and the impact these adjustments will have on the both the firm and its competitors.
Identify whether or not your chosen company needs to seek out other short-term financing arrangement to support your proposed actions.