Calculate Gross working capital , Net working capital and length of the Working Capital Cycle? Level of
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Question:
Calculate Gross working capital , Net working capital and length of the Working Capital Cycle?
Level of Activity = 1,040,000 units
Selling Price = PKR 20 per unit
Raw Material Cost = PKR 8 per unit
Labor Cost = PKR 3 per unit
Overhead Cost = PKR 6 per unit
Raw Material in Stock = 4 weeks
Processing Time = 2 weeks
Finished Goods in stock = 3 weeks
Credit received from customer is 8 weeks
Credit received from supplier is 6 weeks
Delay in payment of wages is 4 weeks
Delay in payment of overheads is 5 weeks
Prepaid Expenses = PKR 20,000
Outstanding Expenses = PKR 50,000
Contingency is 5% of Gross Working Capital
Related Book For
Entrepreneurship & Small Business Management
ISBN: 978-0133767186
2nd edition
Authors: Steve Mariotti, Caroline Glackin
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