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BRILLIANT’S Working Capital Management 153

Working Capital Requirement (in `)
Average Stock of Raw Materials 1,80,000
Average Stock of WIP 1,00,000
Average Stock of Finished Goods 54,000
Average Balance of Debtors 1,50,000
4,84,000
Less: Average Balance of Creditors 1,20,000
Working Capital Requirements 3,64,000
Illustration 2.3.6
The following are the data of Z Ltd. taken from the accounting records:
Z {b{_Q>oS> Ho$ AH$mC§qQ>J [aH$m°S²>©g go {b`m J`m S>mQ>m {ZåZ{b{IV h¡… (`)

Average Stock of Raw Materials during the year
Mmby df© ‘| am° ‘Q>o[a¶ëg H$m EdaoO ñQ>m°H$ 1,80,000

Average Stock of Work-in-progress during the year
Mmby df© ‘| dH©$-BZ-àmoJ«og H$m EdaoO ñQ>m°H$ 1,00,000
Average Stock of Finished Goods during the year
Mmby df© ‘| {’${ZíS> JwS²>g H$m EdaoO ñQ>m°H$ 54,000
Average Balance of Debtors / S>oãQ>g© H$m EdaoO ~¡b|g 1,50,000
Average Balance of Creditors / H«o${S>Q>g© H$m EdaoO ~¡b|g 1,20,000

Average daily Sales / X¡{ZH$ EdaoO goëg 2,000
Average daily cost of Finished Goods sold
~oMo J¶o {’${ZpíS> JwS²>g H$s X¡{ZH$ EdaoO H$m°ñQ> 1,800
Average daily consumption of Raw Material
am° ‘Q>o[a¶ëg X¡{ZH$ EdaoO H$ÝOåßeZ 1,200
Average period of credit available from suppliers is 100 days.
gßbm¶g© go CnbãY H«o${S>Q> H$s EdaoO Ad{Y 100 {XZ h¡
Based on the above data, state: / CnamoŠV S>mQ>m Ho$ AmYma na ~VmB`o…
(a) Average period of Raw Material holding in stores; / ñQ>mog© _| aIo J`o am° _Q>o[a`b H$s Am¡gV Ad{Y&
(b) Credit period allowed to customers; / J«mhH$m| H$mo AZw_{V Xr J`r H«o${S>Q> Ad{Y&

(c) Average period for which finished goods stay in godowns;
Am¡gV Ad{Y {OgHo$ {bE {\${ZíS> JwS²>g H$mo JmoS>mCZ _| aIm OmVm h¡&

(d) Average period of conversion of raw material into finished goods;
am° _Q>o[a`b H$mo {\${ZíS> JwS²>g _| n[ad{V©V H$aZo H$s Am¡gV Ad{Y&
(e) Working capital cycle (in days). / d{Hª$J H¡${nQ>b gm`H$b ({XZm| _|)&