QUESTION 1 [25 MARKS] Your company's monthly management report contains the following statements of working capital: Budget (NS) Actual (NS) Raw materials inventories 50,000 62,000 Finished inventory 15,000 22,000 Accounts receivables 1.500 (13.000) 86,500 101,000 Accounts payables 22,000 17,000 Working capital 64,500 84,000 The managing director is concerned with the high level of working capital and has asked you for an explanation especially as for the period concerned, the actual sales income and production costs were very near to the budgeted figures, and there has been no unplanned capital expenditure during the period. Required: Explain for each element of the working capital statement a. How the situation may have arisen and the problems that may arise if it is allowed to continue. (15) b. The procedures that could be put in place to control the various elements