Parramore Corp has $19million of sales, $2 million of inventories, $2.75 million ofreceivables, and $2 million of payables. Its cost of goods sold is85% of sales, and it finances working capital with bank loans at a7% rate. Assume 365 days in year for your calculations.

A. What is Parramore's cashconversion cycle (CCC)? Do not round intermediate calculations.Round your answer to two decimal places.
days

B. If Parramore couldlower its inventories and receivables by 12% each andincrease its payables by 12%, all without affecting sales or costof goods sold, what would be the new CCC? Do not round intermediatecalculations. Round your answer to two decimal places.
days

C. How much cash would be freedup, if Parramore could lower its inventories andreceivables by 12% each and increase its payables by 12%, allwithout affecting sales or cost of goods sold? Write out youranswer completely. For Example, 13.2 million should be entered as13,200,000. Do not round intermediate calculations. Round youranswer to the nearest dollar.
$  

D. By how much would pretaxprofits change, if Parramore could lower its inventoriesand receivables by 12% each and increase its payables by 12%, allwithout affecting sales or cost of goods sold? Write out youranswer completely. For Example, 13.2 million should be entered as13,200,000. Do not round intermediate calculations. Round youranswer to the nearest dollar.
$  

Part Two

hastain Corporation istrying to determine the effect of its inventory turnover ratio anddays sales outstanding (DSO) on its cash conversion cycle.Chastain's 2019 sales (all on credit) were $235,000, its cost ofgoods sold is 80% of sales, and it earned a net profit of 5%, or$11,750. It turned over its inventory 5 times during the year, andits DSO was 31.5 days. The firm had fixed assets totaling $32,000.Chastain's payables deferral period is 45 days. Assume 365 days inyear for your calculations.

1. Calculate Chastain's cashconversion cycle. Do not round intermediate calculations. Roundyour answer to two decimal places.
   days
2. 
   
3. Assuming Chastain holdsnegligible amounts of cash and marketable securities, calculate itstotal assets turnover and ROA. Do not round intermediatecalculations. Round your answers to two decimal places.
   

   Total assets turnover:
   ROA:		%

4. 
   
5. Suppose Chastain'smanagers believe that the inventory turnover can be raised to 9.1times. What would Chastain's cash conversion cycle, total assetsturnover, and ROA have been if the inventory turnover had been 9.1for 2019? Do not round intermediate calculations. Round youranswers to two decimal places.
   

   Cash conversion cycle:		days
   Total assets turnover:
   ROA:		%