From the following informations given below, prepare an estimate of working capital requirements by projected Balance Sheet (Rs.

) Issued share capital 4,20,000 6% Debenture Fixed Assets at cost The expected ratios of cost to selling price are : Raw Materials 50% Labour 20% Overheads 20% Profit 10% Following further informations are available : (i) Raw materials are kept in store for an average period of two months ; (ii) Finished goods remain stock for an average period of three months ; (iii) Production during the previous year was 1,80,000 units and it is planned to maintain the current year also ; (iv) Each unit of production is expected to be in process for half a month ; (v) Credit allowed to customers is three months and given by suppliers is two months ; (vi) Selling price is Rs. 10 per unit ; (vii) There is a regular production and sales cycle ; (viii) Calculation of debtors may made at selling price ; Projected Balance Sheet (As on.) Amount Assets Rs. 4,20,000 Fixed Assets 80,000 Current Assets : 1,75,200 Stock : Raw Materials 1,50,000 Finished Goods 3,27,300 Work-in-Progress Debtors 11,52,500

Liabilities Share Capital 6% Debenture Profit and Loss A/c Current Liabilities : Creditors Bank Overdraft (Balancing figure)

Amount Rs. 80,000 Rs. 1,50,000 4,05,000 67,500

6,22,500 4,50,000 11,52,500

nts by projected Balance Sheet Method :

rent year also ;