Statement of changes in working capital, Cost Accounting

A statement of changes in working capital assists us in locating where such changes took place. In the first example we try to demonstrate the increase or decrease in particular items and then try to categorize them in terms of decrease and increase in working capital. As working capital is measured through subtracting current liabilities from current assets, any raise in current assets and any reduce in current liabilities demonstrates a raises in working capital. Likewise, reduce in current assets and a raise in current liabilities represent a decrease in working capital.

 The statement of changes in working capital as Table no.1 explains that the raises in current assets amounted to Rs. 52 million, a main part of the increase occurring out of cash, inventory and receivable. Reduce in working capital came about mainly from the increased accounts payable, advances taken from customers and taxes payable. Total amount of reduce in working capital resulting from raise in current liabilities amounted to Rs. 25 million, hence showing a net raise in working capital of Rs. 27 million.

TOLLS INDIA LTD.

Statement of changes in Working Capital for the year ending December 31, 2000

                  (Rs. In Millions)

 

Dec. 31

2003

 

Dec. 31

2002

Increase

(Decrease)

Working Capital

Increase  Decrease

Current Assets

 

 

 

 

 

Cash

19.05

 

10.87

8.18

8.18

Accounts receivable

32.25

 

20.28

11.97

11.97

Loans and advances

42.58

 

33.82

8.76

8.76

Other current assets

17.20

 

15.93

1.27

1.27

Inventory

120.92

 

99.10

21.82

21.82

Total

232.00

 

180.00

52.00

 

 

 

 

 

 

Current Liabilities &

 

Provisions

Acceptances

4.74

 

3.02

 

 

1.72

 

 

1.72

Accounts payable

27.16

 

18.75

 

 

8.41

 

 

8.41

Advances against sales

26.60

 

20.28

 

 

6.32

 

 

6.32

Other liabilities

8.86

 

7.95

 

 

0.91

 

 

0.91

Interest accrued

2.64

 

2.00

 

 

0.64

 

 

0.64

Taxes payable

25.55

 

20.45

 

 

5.10

 

 

5.10

Proposed dividend

2.25

 

2.25

 

 

-

 

 

-

Bonus payable

3.40

 

2.35

 

 

1.05

 

 

1.05

Other provisions

3.80

 

2.95

 

 

0.85

 

 

0.85

Total

105.00

 

80.00

 

25.00

 

52.00

 

25.00

 

 

 

Working Capital

 

 

 

127.00

 

 

 

 

100.00

 

 

 

 

 

 

27.00

 

 

 

 

Increasing Working Capital

 

 

27.00

 

 

 

 

 

 

 

 

 

Posted Date: 4/9/2013 1:49:31 AM | Location : United States







Related Discussions:- Statement of changes in working capital, Assignment Help, Ask Question on Statement of changes in working capital, Get Answer, Expert's Help, Statement of changes in working capital Discussions

Write discussion on Statement of changes in working capital
Your posts are moderated
Related Questions
Example of Contract Account  A company has been awarded a contract to build a house.  It is a contract Number 45 for the company and the contract price is shs.2.65 millio

Ask q6) The Net Sales revenue reported is derived from the sale of products. Each year Findley records from cash sells, sells on account and completed purchase orders. During 2016


The following information pertains to Tudor Logistics Company: 200X Information: Sales                                      $4,875,000 Selling expense

how the NHS might use ABC to (a) produce ‘product costs’ for services, and to (b) evaluate the internal efficiency, quality and profitability per product or service line. Both bene

During the dinner hour, the distribution of the inter-arrival time of customers at Burger Barn is predictable to be as follows: Inter-arrival Time Probabi


format of manufacturing,tradind,p/l a/c

XYZ Company is a family-owned bicycle manufacturing company located in Stow, Ohio.  Until recently,it had maintained slow but steady growth in producing and marketing its only pr

This question tested their knowledge of intended reporting but more importantly requisite them to apply their knowledge and consider the impact from the investors' perspective.