07-29-2010, 10:54 PM
Good Day,
Question - Managerial finance - Credit management
Data on Mash company ltd manufacturing company
Turnover for the year R1 500 000
Costs as a %
Direct materials 30%
Direct labour 25%
Variable overheads 10%
Fixed overheads 15%
Selling and distribution 5%
On average
1. Debtors take 2.5months before payment
2. Raw materials are in stock for three months
3. Work-in-process represents 2 months worth of half produced goods
4. Finished goods represents 1 month's production
5. Credit is taken as follows
i.Direct materials 2 moths
ii.Direct labour 1 week
iii.Variable overheads 1months
iv.Fixed overheads 1months
v.Selling and distribution .5months
Work-in-process and finished goods are valued at material,labour and variable expense cost.
What will be my working capital requirement assuming the labour force is paid for 50 working weeks a year.
I will really appreciate if someone can at least give me a clue where to begin, or how to go about.
Many thanks in advance
Flora
Question - Managerial finance - Credit management
Data on Mash company ltd manufacturing company
Turnover for the year R1 500 000
Costs as a %
Direct materials 30%
Direct labour 25%
Variable overheads 10%
Fixed overheads 15%
Selling and distribution 5%
On average
1. Debtors take 2.5months before payment
2. Raw materials are in stock for three months
3. Work-in-process represents 2 months worth of half produced goods
4. Finished goods represents 1 month's production
5. Credit is taken as follows
i.Direct materials 2 moths
ii.Direct labour 1 week
iii.Variable overheads 1months
iv.Fixed overheads 1months
v.Selling and distribution .5months
Work-in-process and finished goods are valued at material,labour and variable expense cost.
What will be my working capital requirement assuming the labour force is paid for 50 working weeks a year.
I will really appreciate if someone can at least give me a clue where to begin, or how to go about.
Many thanks in advance
Flora
