Drawing power
dinesh kumar (ACCOUNTANT) (32 Points)
06 September 2016
how to calculate drawing power if stock is 34550000 and creditors 83750420 and debtors 104612450
6 Replies
Nitesh joshi
(Ca final)
(115 Points)
Replied 06 September 2016
Drawing Power is calculated after deducting margin from “Stock Less Creditors + Book Debts” for the month.
dinesh kumar
(ACCOUNTANT)
(32 Points)
Replied 06 September 2016
if creditors is more than stock then how to calculate
Nitesh joshi
(Ca final)
(115 Points)
Replied 06 September 2016
If creditors are more, you won’t be granted the LC and BG limits. If you already have LC and BG limits, same will be deducted from the calculated limits
ASHWANI DHANUKA
(Chartered Accountant)
(587 Points)
Replied 06 September 2016
creditors here means trade creditors from whom stocks are purchased. if the trade creditors are more than stock. your dp is debtors less margin.
provided ur sanction
provided ur sanction
CA.Vinita Gupta
(Deputy Manager- Finance)
(2923 Points)
Replied 06 September 2016
Stock + Debtors - Creditors= Net
The Drawing power ranges from 70% to 80 % depending upon the Banks sanction letter
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