4. While preparing a project report, on behalf of a client, you have collected the following facts. Estimate the net working capital required for that project. Add 10 per cent to your computed figure to allow for contingencies. You may assume that production is carried on evenly throughout the year (52 weeks) and wages and overheads accrue similarly. All sales are on credit basis only.

Amount per unit() Estimated cost per unit of production is: Raw material Direct labour 42.4 15.9 Overheads (exclusive of depreciation) 31.8 Total cost Additional information: Selling price 90.1 *106 per unit, Level of activity of production per annum 100,000 units Raw material in stock average 4 weeks Work-in-progress (assume 50% completion stage) average 2 weeks Finished goods in stock average 4 weeks Credit allowed by suppliers average 4 weeks Credit allowed to debtors average 8 weeks average 1 weeks Lag in payment of wages Cash at bank is expcted to be *125.000.