Statement used in working capital requirement, Financial Management

Assignment Help:

• Debtors :-

Working Capital tied up in debtors must be estimated on the basis of cost of sales (excluding depreciation):
[Cost of goods produces (that is raw materials + wages manufacturing, administrative & selling overhead)] * [Average debt collection period (weeks / months)]/[(52 weeks/ 12 months)]= ---------

• Cash and Bank Balance :-

(That is minimum cash balance required to be maintained = ----
----
Total Current Assets (A) _______

Less: Current Liabilities ----

• Trade Creditors :-

[Credit period allowed by creditors Of raw material] *[ Cost of yearly consumption (weeks/ months) / (52 weeks/ 12 months)] m= --------

• Wages :-

Yearly wages * [Average time lag in payment of wages (weeks/ months)/ (52 weeks/ 12 months)]

• Overheads:-

Yearly Overheads (other Than Depreciation) * [Average time lag in payment of overheads (weeks/ months) / (52 weeks/ 12 months)] =

Total Current Liabilities (B) --------------

Working Capital (A) - (B) --------------

Add: Provision for Contingencies --------------

Estimated Working Capital Requirement --------------


Related Discussions:- Statement used in working capital requirement

Calculate amount to fund the endowment, On Completion of her introductory f...

On Completion of her introductory finance course, Kieran was so pleased with the amount of useful and interesting knowledge she gained that she convinced her parents, who were weal

What to do to maximise profits of the company, What to do to maximise profi...

What to do to maximise profits of the company If you want to maximise profits, there are only two methods to do it. Either you decrease your expenses (also known as costs) or y

Currency swap, How exchange of principal and interest in one currency? E...

How exchange of principal and interest in one currency? Expalin

Contribution plans-pension fund plans, Defined Contribution Plans In de...

Defined Contribution Plans In defined contribution plans, the contributions made by or on behalf of the employee are accumulated and paid on retirement along with such return a

LEVERAGE, Evaluate the importance of leverage in financial management of a ...

Evaluate the importance of leverage in financial management of a small scale company

Benefits of interest rate swaps, Q. Benefits of Interest rate swaps? I...

Q. Benefits of Interest rate swaps? Interest rate swaps may provide several benefits to companies including: - The ability to get finance at a cheaper cost than would be p

Rate changes and duration estimate, To calculate duration, we need to...

To calculate duration, we need to first obtain the values for V - and V + where V - is the price when the yield decreases by certain number of basis points and V +

Exchange Rate Parity Conditions, 1) According to the IFE (RIP), if U.S. inv...

1) According to the IFE (RIP), if U.S. investors expect a 3% rate of domestic inflation over one year, and a 6% rate of inflation in European countries that use the EUR, and requir

Principle of opportunity cost, Suppose you have recently been contracted as...

Suppose you have recently been contracted as a financial consultant to a London-based engineering company, Alpha Products Plc. The company uses three components as part of their pr

Operating cycle, #question application of an operating.cycle in vegetable g...

#question application of an operating.cycle in vegetable growing business.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd