09 December 2008
The following data relating to a consumer goods manufacturing firm is available for the year ended 31st MArch. No of days R.M. in storage - 30days, debtors collection Period - 30days , COnversion Process Period- 12 days, Finished Goods Storage Period - 45 days, Average Credit Period from suppliers - 50 days, Advance payment to Creditors - 5 days, Total Cash Opertaing Expenses per annum - 600 days, 60% of the TOTAL Cash Operating Expenses are due to RAW MAterial. Required : 1) Determine the average Cash Working Capital needed by the firm at any Point of time during the year assuming that the firm wants to carry a cash balance of Rs. 10 Lakhs at all the time. 2) Compute the working Capital Turnover Rate for the Year.
CAclubindia
