Merge pull request #433 from roberanegussie/cash_conversion_cycle

Cash Conversion Cycle

DOCUMENTATION.md

@@ -26,10 +26,23 @@
 |                                |                                           | - `net_receivables` (float): The amount of net_receivables.|
 |                                |                                           | - `annual_operating_expenses` (float): The amount of annual_operating_expenses.|
 |                                |                                           | - `non_cash_charges` (float): The amount of non cash charges.|
+| --------------------------- | ----------------------------------------     | --------------------------------------------------------- |
 | GET /financial_assest_ratio   | Calculate financial assest ratio           | - `current_assets` (float): used up within a short period.                 |
 |                             |                                            | - `current_liabilities` (float): debts that are due .       |
 |                             |                                              | - `total_debt` (float): aggregate amount of money.                   |
 |                             |                                              | - `total_equity`(float): residual interest in the assets.                   |
 |                             |                                              | - `net_income` (float): net earnings.                   |
 |                             |                                              | - `total_revenue` (float): sum of all sales.                   |
-| --------------------------- | ----------------------------------------     | --------------------------------------------------------- |
+
+|----------------------------|----------------------------------------|-------------------------------------------------------------------------------|
+| GET /cash_conversion_cycle | Calculate Cash Conversion Cycle  | - `beginning_inventory` (float): The amount of inventory beginning the cycle. |
+|                            |                                  | - `ending_inventory` (float): The final amount of inventory ending the cycle. |
+|                            |                                  | - `beginning_receivables` (float): The amount of receivables beginning the cycle. |
+|                            |                                  | - `ending_receivables` (float): The final amount of receivables ending the cycle. |
+|                            |                                  | - `beginning_payable` (float): The amount of payable beginning the cycle. |
+|                            |                                  | - `ending_payable` (float): The final amount of payable ending the cycle. |
+|                            |                                  | - `cost_of_goods_sold` (float): The total cost related to producing goods sold by a business. |
+|                            |                                  | - `net_credit_sales` (float): Sales where the cash is collected at a later date. |
+|----------------------------|----------------------------------------|----------------------------------------------------------------------|
+
+

ENDPOINTS.md

@@ -2083,7 +2083,16 @@ Sample Output
 - Request body : `{
   "profit": 1560.8,
   "cost_price": 7500.4
-=======
+}`
+```py
+{
+  "Tag": "Profit Percentage",
+  "Profit": 1560.86,
+  "Cost Price": 7500.47,
+  "Profit Percentage": 20.81,
+}
+```
+
 **POST** `/defensive_interval_ratio`
 
 - Request body : `{
@@ -2094,15 +2103,19 @@ Sample Output
 	"non_cash_charges": 25000.00
 }`
 - Sample output
-
 ```py
 {
-  "Tag": "Profit Percentage",
-  "Profit": 1560.86,
-  "Cost Price": 7500.47,
-  "Profit Percentage": 20.81,
+  "Tag": "Defensive Interval Ratio",
+	"Cash": 40000.00,
+	"Marketable Securites": 20000.00,
+	"Net Receivables": 10000.00,
+	"Annual Operating Expenses": 300000.00,
+	"Non Cash Charges": 25000.00,
+	"Current Assets": 70000.0,
+	"Daily Operational Expenses": 753.42,
+	"Defensive Interval Ratio": 92.90
 }
-```
+``` 
 
 **POST** `/loss_percent`
 
@@ -2119,17 +2132,6 @@ Sample Output
   "Cost Price": 7500.47,
   "Loss Percentage": 6.67,
 }
-```
-	"Tag": "Defensive Interval Ratio",
-	"Cash": 40000.00,
-	"Marketable Securites": 20000.00,
-	"Net Receivables": 10000.00,
-	"Annual Operating Expenses": 300000.00,
-	"Non Cash Charges": 25000.00,
-	"Current Assets": 70000.0,
-	"Daily Operational Expenses": 753.42,
-	"Defensive Interval Ratio": 92.90
-}
 ``` 
 
 **POST** `/financial_assest_ratio`
@@ -2156,4 +2158,37 @@ Sample Output
   "net_profit_margin": 0.2,
   "price_to_earnings_ratio": 20.5
 }
+```
+
+**POST** `/cash_conversion_cycle`
+
+- Request body : `{
+  "beginning_inventory": 1000,
+  "ending_inventory": 2000, 
+  "beginning_receivables": 100
+  "ending_receivables": 90,
+  "beginning_payable": 800,
+  "ending_payable": 900,
+  "cost_of_goods_sold": 3000,
+  "net_credit_sales": 3000
+}`
+- Sample output
+
+```py
+{
+  "Tag": "Cash Conversion Cycle",
+  "Beginning Inventory": 1000,
+  "Ending Inventory": 2000,
+  "Average Inventory": 1500,
+  "Beginning Receivables": 100,
+  "Ending Receivables": 90,
+  "Average Receivables": 95,
+  "Beginning Payable": 800,
+  "Ending Payable": 900,
+  "Average Payable": 850,
+  "Days of inventory_outstanding": 182.5,
+  "Days of Sales Outstanding": 11.56,
+  "Days of Payables Outstanding": 103.42,
+  "Cash Conversion Cycle":  90.64 days",
+}
 ```

helpers/functions.py

@@ -2001,3 +2001,17 @@ def calculate_financial_asset_ratios(current_assets, current_liabilities, total_
     }
 
     return ratios
+
+# Function to Calculate Cash Conversion Cycle
+
+def cash_conversion_cycle(beginning_inventory: float, ending_inventory: float, beginning_receivables: float, 
+ending_receivables: float, beginning_payable: float, ending_payable: float, cost_of_goods_sold: float, 
+net_credit_sales: float):
+	average_inventory = beginning_inventory - ending_inventory / 2
+	average_receivables = beginning_receivables - ending_receivables / 2
+	average_payable = beginning_payable - ending_payable / 2
+	days_of_inventory_outstanding = (average_inventory / cost_of_goods_sold) * 365 
+	days_of_sales_outstanding = (average_receivables / net_credit_sales) * 365
+	days_of_payables_outstanding = (average_payable / cost_of_goods_sold / 365)
+	ccc = days_of_inventory_outstanding + days_of_sales_outstanding - days_of_payables_outstanding
+	return ccc

main.py

@@ -131,7 +131,8 @@
 from tasks.profit_percentage import profit_percentage_task
 from tasks.loss_percentage import loss_percentage_task
 from tasks.defensive_interval_ratio import defensive_interval_ratio_task
-from validators.request_validators import SimpleInterestRateRequest, calculatePension, compoundInterest, futureSip, paybackPeriod, capmRequest, DebtServiceCoverageRatio, futureValueOfAnnuity, futureValueOfAnnuityDue, ProfitPercentage, LossPercentage, DefensiveIntervalRatio, financialAssestRatio
+from tasks.cash_conversion_cycle import cash_conversion_cycle_task
+from validators.request_validators import SimpleInterestRateRequest, calculatePension, compoundInterest, futureSip, paybackPeriod, capmRequest, DebtServiceCoverageRatio, futureValueOfAnnuity, futureValueOfAnnuityDue, ProfitPercentage, LossPercentage, DefensiveIntervalRatio, CashConversionCycle, financialAssestRatio
 from tasks.financialAssestRatio import financial_assest_ratio
 
 # Creating the app
@@ -1894,3 +1895,16 @@ def financial_assest_ratio(request: financialAssestRatio):
 	request.total_equity,
 	request.net_income,
     request.total_revenue)
+
+# Endpoint to calculate Cash Conversion Cycle
+
+@app.post(
+    "/cash_conversion_cycle",
+    tags=["cash_conversion_cycle"],
+    description="Calculate Cash Conversion Cycle",
+)
+def cash_conversion_cycle(request: CashConversionCycle):
+    return cash_conversion_cycle_task(request.beginning_inventory , request.ending_inventory ,
+    request.beginning_receivables, request.ending_receivables , request.beginning_payable, 
+    request.ending_payable , request.net_credit_sales , request.cost_of_goods_sold)
+

tasks/cash_conversion_cycle.py

@@ -0,0 +1,33 @@
+from helpers import functions
+from fastapi import HTTPException, status
+
+def cash_conversion_cycle_task(beginning_inventory: float, ending_inventory: float, beginning_receivables: float, 
+ending_receivables: float, beginning_payable: float, ending_payable: float, cost_of_goods_sold: float,
+net_credit_sales: float):
+    try:
+        average_inventory = beginning_inventory - ending_inventory / 2
+        average_receivables = beginning_receivables - ending_receivables / 2
+        average_payable = beginning_payable - ending_payable / 2
+        days_of_inventory_outstanding = (average_inventory / cost_of_goods_sold) * 365 
+        days_of_sales_outstanding = (average_receivables / net_credit_sales) * 365
+        days_of_payables_outstanding = (average_payable / cost_of_goods_sold / 365)
+        ccc = functions.cash_conversion_cycle(beginning_inventory, ending_inventory, beginning_receivables, 
+		ending_receivables, beginning_payable, ending_payable, cost_of_goods_sold, net_credit_sales)
+        return {
+            "Tag": "Cash Conversion Cycle",
+            "Beginning Inventory": beginning_inventory,
+            "Ending Inventory": ending_inventory,
+            "Average Inventory": average_inventory,
+            "Beginning Receivables": beginning_receivables,
+            "Ending Receivables": ending_receivables,
+            "Average Receivables": average_receivables,
+            "Beginning Payable": beginning_payable,
+            "Ending Payable": ending_payable,
+            "Average Payable": average_payable,
+            "Days of inventory_outstanding": days_of_inventory_outstanding,
+            "Days of Sales Outstanding": days_of_sales_outstanding,
+            "Days of Payables Outstanding": days_of_payables_outstanding,
+            "Cash Conversion Cycle": f"{ccc} days",
+        }
+    except:
+        return HTTPException(status_code=status.HTTP_500_INTERNAL_SERVER_ERROR)

validators/request_validators.py

@@ -611,4 +611,14 @@ class financialAssestRatio(BaseModel):
     total_equity: float
     net_income: float
     total_revenue: float
+
+class CashConversionCycle(BaseModel):
+	beginning_inventory: float 
+	ending_inventory: float  
+	beginning_receivables: float 
+	ending_receivables: float  
+	beginning_payable: float 
+	ending_payable: float
+	cost_of_goods_sold: float
+	net_credit_sales: float