Question
Q.1.Casez Ltd., manufacturer of suitcases, makes 700 boxes per annum. Selling price of each suitcase is Rs.1000 and the variable cost is Rs.400 per piece.
Q.1.Casez Ltd., manufacturer of suitcases, makes 700 boxes per annum. Selling price of each suitcase is Rs.1000 and the variable cost is Rs.400 per piece. It incurs fixed expenses of Rs.1,20,000 per year .Only 10% of its sales are made in cash. Every year the firm spends Rs.20, 000 on advertising and this year its investment in the purchase of raw materials is 20% of its total turnover. Additional information is given below.(in Rs. 000) i Opening balance of a Raw materials, stores, etc. 40 b Work-in-process 35 c Finished goods 80 d Debtors 90 e Creditors 120 ii Closing balance of a. Raw materials, stores, etc. 45 b. Work-in-process 55 c. Finished goods 90 d. Debtors 100 e. Creditors 70 iii. Depreciation 30 iv. Excise duty 30 v. Selling and administration expenses 40 Assuming uniform production and sales throughout the year, calculate the operating cycle for Casez Ltd.
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