Chapter 13 Working Capital Management

A photo of a gear, wrench, and nut and bolt set.

Learning Objectives

  1. LO1 Model the cash conversion cycle and explain its components.

  2. LO2 Understand why the timing of accounts receivable is important and explain the components of credit policy.

  3. LO3 Understand the float concept and its effect on cash flow and explain how to speed up receivables and slow down disbursements.

  4. LO4 Explain inventory management techniques and calculate the economic order quantity (EOQ).

  5. LO5 Account for working capital changes in capital budgeting decisions.

In Chapter 12, we focused on cash inflow and outflow: the natural flow of funds into and out of a company through the ...

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