Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
The requirement for working capital fluctuates according the level of inventory, production, debtors and creditors etc. The working capital needs are not uniform during the year because of the seasonality of the product being manufactured and business cycles. Separately from this, the working capital requirement would also base upon the demand of the product and demand-supply condition of the raw material. Relationship of all these variables would find out the requirement for working capital at any time.
Under situations where the working capital requirement is decreased, it results in excess cash. Such excess cash may be required while the demand picks up. The firms might hold this surplus cash as buffer to meet unpredictable financial requirements. As this excess cash doesn't earn any return the firms may invest such cash balance in marketable securities and another investment avenue.
Because this excess cash balance is obtainable only for a short period of time, this should be invested in liquid securities and highly safe. The three fundamental features: safety, marketability and maturity must be kept in mind whereas making investment decisions regarding temporary excess cash. Now safety implies that the default risk that is: payment of interest and principal amount on maturity must be minimized. As the prices of long-term securities are more sensitive to interest rate modifications as compared to short-term securities the firms must invest in securities of short-term maturity. Marketability termed as convenience, transaction and speed cost along with that security or an investment can be converted in cash.
Given budgeted figures and actual, then analyses each fixed cost into its components
JIT purchasing On the other hand is a purchasing system in which material purchased are contracted so as that the receipt and usage of materials to the maximum extent possible,
Question: (a) "Budgetary control comprises two distinct elements - Planning and Control''. ‘'A budget is a statement of what it is reasonable to believe can be made to ha
State Factors determining Working Capital requirement.
EVALUATION OF THE REGRESSION MODEL The regression equation calculated above was based on the assumption that cost varied with the units produced. However, a number of different
Granger products had the following transactions for the just completed month. The company had no beginning inventories. a)$75,000 in raw materials were purchased for cash. b) $7
What are the features of performance budgeting The main features of performance budgeting are: a) Classification into functions activities or programmers. b) Specifyi
Imposed Budgets In this approach to budgeting, top management prepares a budget with little or no help from operating personnel, which is then obligatory upon the employees who
Assignment help
importance of ratio analysis
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd