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please ans in 10 mins You are required to prepare a statement showing the working capital required to finance the level of activity of 18,000
please ans in 10 mins
You are required to prepare a statement showing the working capital required to finance the level of activity of 18,000 units per year from the following information:- Particulars Rs. Raw material Per Unit 12 Direct labor Per Unit 3 Overheads per Unit 9 Total cost Per Unit 24 Profit per Unit 6 Selling price Per Unit 30 Additional Information: 1. Raw material is in stock on an average for 2 months 2. Materials are in process on an average for half-a-month. 3. Finished goods are in stock on an average for two months 4. Credit allowed by creditors is two months in respect of raw materials supplied. 5. Credit allowed to debtors is three months. 6. Lag in payment of wages is half month. Cash on hand and at bank is expected to be Rs. 7,000. 7. You are informed that all activities are evenly spread out during the year. (Note: Assume working capital consumes 100% raw material, 50% labour and 50% Overheads)Step by Step Solution
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