Estimation of current assets, Financial Management

Assignment Help:

What is Estimation of Current Assets? Please provide me report on Estimation of Current Assets. It is about 2000 words count report on topic Estimation of Current Assets.

Related Discussions:- Estimation of current assets

What is estimate of stock, Stock A has settled into a constant dividend gro...

Stock A has settled into a constant dividend growth pattern of 6 percent per year. The current dividend is $1.50, its current price is $15.90. You are an analyst and believe that

Determine the concept of cash flow to shareholders, Does financial leverage...

Does financial leverage (debt) have any impact on the Free Cash Flow, on the Cash Flow to Shareholders, on the growth of the company and on the value of the shares? Debt has no

Location of lifting anchors in precast concrete units, Q. Location of lifti...

Q. Location of lifting anchors in precast concrete units? It is desirable that position of anchors be located symmetrical to the centre of gravity of precast concrete units. Or

Calculate the cca allowance anfd the pv of tax shield , Home Inc. is consid...

Home Inc. is considering buying a new piece of equipment, which will cost $715,000 and has an economic life of 5 years, in order to produce a new line of product. The company beli

Brief introduction of asset backed security, An asset-backed security is a ...

An asset-backed security is a type of bond or note that is based on a pool of assets, or collateralized by the cash flows from a specified pool of underlying assets. As

Portfolio management and asset pricing, I am facing some problems in my ass...

I am facing some problems in my assignment of Portfolio Management. Can anybody suggest me the proper explanation for it?

Define the meaning of rate of return on investment, Define the meaning of r...

Define the meaning of rate of return on investment An investment project which provides positive NPV when its cash flows are discounted by cost of capital makes a net contribut

Explain the term- operating segments, Operating segments An operating s...

Operating segments An operating segment is a component of an organisation It engages in business activities from that it can earn revenues and incur expenses(this also c

Financial leverage, Financial Leverage In accounting and finance, ...

Financial Leverage In accounting and finance, the amount of long lasting debt that an organization has in relation to its equity the longer the ratio, the larger the lever

Why do we focus on cash flows instead of profits, Why do we focus on cash f...

Why do we focus on cash flows instead of profits when evaluating proposed capital budgeting projects? We focus on cash flows at the place of profits when evaluating proposed ca

Harry 2/14/2013 1:38:44 AM Estimation of Current Assets Current assets estimation includes: Raw materials Requirement cost This is computed by multiplying the daily requirement by the age of raw materials. Assume if the raw material cost is $5 per unit and the company expects to produce and sell 36000 units in the coming year and the age of raw materials is 45, raw materials requirement cost would be = Daily requirement x Age of raw materials. Raw Materials requirement cost = (36000 x $5 x 45) / 365 = $22,192 Work-in-Progress stock requirement cost This is computed by multiplying the daily requirement of various sub-components of WIP by the age of WIP (Work in progress). Suppose if the Raw material cost is $5 per unit and where as wages is $4 per unit and production overhead is $4 per unit and the age of WIP is 30 days, the WIP (Work in progress) stock requirement cost would be: (36000 units per year) Raw material component = 36,000 x $5 x 30 /365 = $14,795 Wages (Direct labor) Component = 36,000 x $4 x 30 / 365 = $11,836 Production overhead component = 36,000 x $4 x 30 / 365 = $11,836 Total WIP requirement cost = $38,467

Harry

2/14/2013 1:38:44 AM

Estimation of Current Assets

Current assets estimation includes:

Raw materials Requirement cost

This is computed by multiplying the daily requirement by the age of raw materials. Assume if the raw material cost is $5 per unit and the company expects to produce and sell 36000 units in the coming year and the age of raw materials is 45, raw materials requirement cost would be = Daily requirement x Age of raw materials.

Raw Materials requirement cost = (36000 x $5 x 45) / 365 = $22,192

Work-in-Progress stock requirement cost

This is computed by multiplying the daily requirement of various sub-components of WIP by the age of WIP (Work in progress). Suppose if the Raw material cost is $5 per unit and where as wages is $4 per unit and production overhead is $4 per unit and the age of WIP is 30 days, the WIP (Work in progress) stock requirement cost would be: (36000 units per year)

Raw material component = 36,000 x $5 x 30 /365 = $14,795

Wages (Direct labor) Component = 36,000 x $4 x 30 / 365 = $11,836

Production overhead component = 36,000 x $4 x 30 / 365 = $11,836

Total WIP requirement cost = $38,467

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages