Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

11. Following details are available from the management of BAS Ltd: Particulars Amount per unit) Raw materials 120 Direct labour 45 Overhead 90 The company

image text in transcribed

11. Following details are available from the management of BAS Ltd: Particulars Amount per unit) Raw materials 120 Direct labour 45 Overhead 90 The company wants to make 15% profit on sales price. The following further particulars are available: Raw materials are kept in stock, on average, for one month. Processing time can be taken as, on average, half a month; Finished goods in stock, on average, for 30 days. Credit enjoyed by BAS Ltd. in one month; Credit allowed is for two months; Average time-lag in payment of wages and overhead is one month. Cash in hand and at bank is desired to be maintained at 30,000. BAS Ltd. prefers to value debtors at sales value. Compute the working capital required for BAS Ltd. with necessary assumptions to finance a level of activity of 24,000 units of production in the next year. 20

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Emerging Markets And Financial Resilience Decoupling Growth From Turbulence

Authors: C. Hooy, R. Ali, HooyChee-Wooi, S. Ghon Rhee

2nd Edition

1137266600, 9781137266606

More Books

Students also viewed these Accounting questions

Question

Name 5 types of natural disasters you may need to plan for

Answered: 1 week ago

Question

Review the determinants of direct financial compensation.

Answered: 1 week ago