firm has applied for working capital finance from a commercial bank. Estimate theworking capital requirements. You can add 10% to estimated figures for exigencies.Sales - 2,247,000COGS - 1,637,100GP - 609,900Admin expenses - 149,800Selling exp - 139,100Profit before tax - 321,000Tax provision - 107,000PAT - 214,000COGS Material used - 898,800Wages and other manf. Exp - 668,750Depreciation - 251,450Less: stock and finished goods (10% product not yet sold) - 181,900The above figures are related to finished goods and not for WIP, 15% of year's productionare in progress on an average requiring full material but only 40% of other expenses. Thefirm has policy of keeping two months consumption of material in stock. All expensesare paid one month in arrear. Suppliers give one and half month credit, 20% sales are incash, credit period allowed is two months.

Name: firm has applied for working capital finance from a commercial bank.
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Description: firm has applied for working capital finance from a commercial bank. Estimate theworking capital requirements. You can add 10% to estimated figures for exigencies.Sales - 2,247,000COGS - 1,637,100GP - 609,900Admin expenses - 149,800Selling exp - 139

Working capital requirement is the net amount expected to be in hand in order to manage the working…

Business

Accounting

The above figures are related to finished goods and not for WIP, 15% of year's production are in progress on an average requiring full material but only 40% of other expenses. The firm has policy of keeping two months consumption of material in stock. All expenses are paid one month in arrear. Suppliers give one and half month credit, 20% sales are in cash, credit period allowed is two months.

The above figures are related to finished goods and not for WIP, 15% of year's production are in progress on an average requiring full material but only 40% of other expenses. The firm has policy of keeping two months consumption of material in stock. All expenses are paid one month in arrear. Suppliers give one and half month credit, 20% sales are in cash, credit period allowed is two months.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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