Sales Selling Price Total sales in Sales Profit 20% of sales Cost of Goods Sold 80,000 Units Rs. 8 Rs. 6,40,000 Rs. 6.40.000 1.28.000 5,12,000 Rs 98,462 Statement of Working Capital Particulars Current Assets 10 Debtors (5,12,000 x 52 10 IL Stock (5,12,000 52 Total Current Assets Less: Current Liabilities Creditors (5,12,000 x Net Working Capital Add: Contingencies 20% Net Working Capital Required 98,462 1.96.924 78,769 t15 1.18.155 23,631 1,41,786 Cash Management Exercise 14 A Company expects to have Rs. 37500 cash in hand on 1st April, and requires you to prepare an estimate of cash position during the three months. April, May and June the following information is supplied to you: Month Sales Purchases Wages Factory Office Selling Rs. Rs. Rs. Expenses Expenses Expenses Rs. Rs. Rs. Feb 75,000 45,000 9.000 7.500 6,000 4,500 March 84.000 48,000 9.750 8.250 6,000 4,500 April 90.000 52,500 10,500 9,000 6,000 5,250 May 1.20.000 60.000 13.500 11.250 6,000 6,570 June 1,35,000 60.000 14.250 14.000 7,000 7,000 Other Information: (i) Period of credit allowed suppliers 2 months (1) 20% of sales for cash and period of credit allowed to customers for credit is one month. (iii) Delay in payment of all expenses:1 month. (iv) Income tax of Rs. 57,500 is due to be paid on June 15th. (v) The company is to pay dividend to shareholders and bonus to workers of Rs. 15,000 and Rs. 22,500 respectively in the month of April. (vi) A plant has been ordered to be received and paid in May. It will cost Rs. 1,20,000. (Periyar University M.Com., Nov. 2005)