this is a finance case study.
I just have to work on question 1 .. CASE A … the question in part 2. So need help on it.
you will have to read the case, which is pretty small… and answer the question below:
II. Point out that working capital is often viewed by companies simply as cost, and as a result, the company management tends to react to a “cash squeeze” by slashing working capital expenditure without carefully considering its implications for sales, profitability and growth. At the other end, there is also a tendency to invest too much in working capital to maximize short-term profit. Instead what you want to promote is an integrated and value-creating approach to working capital management in which all elements of tied-up capital across the balance sheet (fixed assets, inventories, receivables, payables, and cash) have to be considered as a whole. For example, it may be advantageous to acquire a new and more flexible machine (fixed asset) in order to reduce inventories.
Thats about it.