Working Capital Management (Session 1,2,3) Please find below the data for a manufacturing company located in Noida called Infinity Ltd: Revenue for the year: 1,000,000 Cost as a % of Sales Direct Material 35% Direct Labour 25% Variable overheads 10% Fixed Overheads 15% Selling and Distribution 5% On an average it has been observed: i) It takes 2.5 months before Debtors give payment ii) Raw materials remain in inventory for 3 months ili) WIP is 1 month of partially produced goods iv) Finished goods represents 1 month or production v) Credit is taken as follows: Direct Material months Direct Labour week Variable overheads 2 months Fixed Overheads 1 month Selling and Distribution 0.5 months WIP and FG are valued at direct material, direct labour and variable expense cost Assume all labour is paid for 50 weeks in a year a. Prepare a statement of Working Capital. b. There is a competitor in Gurgaon called Black Hole Ltd that has similar terms as Infinity Lid, but they have a better relationship with their vendors, and are able to procure Direct Material at 32% of Cost of Sales. They also pay their labour slightly better wages than Infinity Lid at 28% of Cost of Sales. Even their Selling and Distribution expenses are more streamlined at 4% Cost of Sales. All other things remaining the same, how do you think this impacts the numbers of Black Hole Limited? Who is performing better? Please validate your answer with adequate explanation