Q. 5 M/s H Ltd.

gives the following details to prepare the statement of Working Capital

requirement for the year 2016-17.
Projected Revenue Statement for the year 2016-17
Particulars ₹ ₹
Sales 18,00,000
Less:
Purchases 800,000
Wages 200,000
Overheads 150,000 11,50,000
650,000
Less: Expenses
Office and Admin Expenses 180,000
Selling and Distribution Expenses 120,000 300,000
350,000
During the year 2016-17 it is estimated that
1. Raw materials will be in store for 30 days
2. Finished goods will be in stock after production for 45 days
3. The processing period will be 20 days
4. 70% of purchases and sales will be on credit of 20 days and balance on cash
5. Wages and Overheads will be paid at the time lag of 10 days
6. Office and Administrative Expenses will be at the time lag of 20 days
7. The expected Cash And Bank Balance will be ₹ 78,000
8. Operations are evenly spread and expenses accrue evenly
9. Debtors are estimated at selling price
10. Company works for 300 days during the year

Q. 6 M/s T Ltd. plans to produce 19,000 units during the year 2016-17 and to sell them for ₹
150 per unit.
Cost Structure of the product is
Raw Materials 60%
Labour 15%
Overheads 10%
85%
Profit 15%
Selling Price 100%
Further details are available for the year 2016-17
1. Raw Materials equivalent to 1 month’s supply is stored in the godown.
2. Production process takes 1 month.
3. Finished goods equal to 3 month’s production are carried in stock.
4. Customers get credit of 2 months and suppliers allow credit of 1½ months
5. Time lag in payments of wages and overheads is ½ month.
6. 20% of sales are made on cash basis and balance on credit.
7. Cash and Bank balance will be maintained at ₹ 10,000.
Q. 7 You are required to prepare a statement showing the requirement of working capital of S
Ltd. Forecast level of activity is 52,000 units for the year 2016-17 (52 weeks)
Cost Structure :
Particulars Cost per Unit (Rs)
Raw Materials 400
Direct Labour 150
Manufacturing Overheads 200
Selling and Distribution Overheads 100
850
Additional Information :
a) Selling Price Rs 1,000 per unit.
b) Raw material in stock – average 4 weeks.
c) Credit allowed by suppliers – average 4 weeks.
d) Expected Cash Balance – Rs 50,000.
e) Work in Process –average 4 weeks
f) Credit allowed to customers – average 8 weeks.
g) Finished goods in stock – average 4 weeks.
h) All sales are on credit basis.
i) Debtors are to be valued at selling price.
j) All activities are evenly spread during the year.

Q. 8 From the following details of K Ltd., prepare a statement of working capital

requirements for the year ending 31st March 2017.
1. It is anticipated that production and sales during the year would be 5,000 units.
2. The Selling Price will be Rs 200 per unit.
3. The expected elements of cost to Selling Price would be
Raw Materials 60%
Wages 10%
Overheads 15%
4. Raw material will be carried in stock equal to 3 weeks consumption.
5. The Finished Goods will be carried in stock equal to 6 weeks production.
6. 70% of sales will be on credit and credit period would be on an average 6
weeks.
7. The suppliers of raw materials will give credit of 3 weeks.
8. Time lag in payment of wages and overheads will be 3 weeks.
9. Cash and Bank Balance will be maintained at Rs 25,000.
10. Debtors are to be valued at selling price.
11. Company works for 50 weeks in a year.
12. All activities are evenly spread during the year.