Forecasting Indicates That the Need for Skilled Technical Employees in Your

question 92

Essay

Forecasting indicates that the need for skilled technical employees in your company will increase dramatically this year.If the company continues on its present course,it will experience a substantial labor shortage by year's end.Something must be done fast,but management is concerned about maintaining its flexibility.Which of the options for avoiding expected labor shortages would be most appropriate under these circumstances? Explain your answer.

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Definitions:

Cash Conversion Cycle

A metric that shows the time it takes for a company to convert its investments in inventory and other resources into cash flows from sales.

Operating Cycle

The period between the acquisition of inventory and the collection of cash from receivables.

Compensating Balances

Compensating balances are minimum balance requirements that a bank may impose on a borrower, kept in a non-interest-bearing account, as part of loan agreements.

Cash Conversion Cycle

The cash conversion cycle measures the time it takes for a company to convert resource inputs into cash flows, indicating the efficiency of managing inventory and receivables.