Calculate the additional working capital requirement

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Reference no: EM13181811

A company is currently operating at 60% of its capacity producing 36,000 units during the year 2009 at the following cost price structure:

	Rs. per unit
Materials	4.00
Labour	3.00
Overheads (60% variable)	3.00
Profit	2.00
Selling Price	12.00

On 31 December 2009, the company has the following Current Assets and liabilities:


Stock of Raw Materials	12,000
Stock of WIP	21,000
Stock of Finished Goods	60,000
Sundry Debtors	72,000
Sundry Creditors	18,000
Outstanding Wages	9,000
Outstanding Overheads	4,500

In the year 2010, the company wishes to operate at 80% of its capacity at the same Cost Price structure and selling price of 2009.

Calculate the additional Working Capital Requirement in the year 2010.

Reference no: EM13181811

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