(2.12.

2) Cash Cycle and operating cycle:-

(2.12.1)Inventory Conversion Period:-

Average Inventory
(1)Inventory Conversion Period = X 365
Cost of Goods Sold

Average Inventory=(Opening stock of Inventory + Closing

Stock of Inventory)/2
For Year
2008-09= (8968.78+8369.94)/2=8669.360
2007-08= (8369.94+8113.15)/2=8241.545
2006-07= (8113.15+8601.72)/2=8357.075
2005-06= (8601.72+8129.44)/2=8365.580

Cost of Goods Sold= Generation Expenses

For Year
2008-09=90608.48
2007-08=64600.67
2006-07=46621.87
2005-06=44685.60

Inventory Conversion Period

For Year
8669.36
2008-09= X 365 =34.92 Days
90608.48

8241.545
2007-08= X 365 =46.57 Days
64600.67