Question: From the following information, prepare a statement showing the Average Working Capital requirements: Budget sales - Rs. 7,80,000 Analysis of cost of each unit: Rs.

From the following information, prepare a statement showing the

Average Working Capital requirements:

Budget sales - Rs. 7,80,000

Analysis of cost of each unit: Rs.

Raw materials 4.50

Labour 2.50

Overheads 2.00

Profit 1.00

Sale price 10.00

It is estimated that:

i. Pending use, raw materials are carried in stock for three weeks

and finished products for two weeks.

ii. Factory processing will take three weeks.

iii. Suppliers will give four weeks credit and customers required six

weeks credit

iv. Cash on hand is estimated to be Rs. 25,000

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