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

Financial ratio analysis, 1. Calculate the compound average annual growth r...

1. Calculate the compound average annual growth rate in sales and profit after tax

Arrow as an fsa’s risk based approach to regulation, ARROW as an FSA's risk...

ARROW as an FSA's risk based approach to regulation ARROW stands for Advanced, Risk-Responsive Operating Framework. In January 2000, FSA set out a proposed approach to regulati

Describe the sales forecasting process, Describe the sales forecasting proc...

Describe the sales forecasting process. Sales assumptions are a group effort. Marketing and Sales personnel usually provide assessments of demand and the competition. Producti

Evaluate earning yield plus growth in earning method, Q. Evaluate Earning Y...

Q. Evaluate Earning Yield plus Growth in Earning Method? Earning Yield plus Growth in Earning Method: - If the EPS of a company is likely to grow at a constant rate of growth t

Leverage, ABC Ltd. Produces electronic components with a selling price per ...

ABC Ltd. Produces electronic components with a selling price per of Rs.100. Fixed cost amount to Rs.2,00,000/- 5000 units are produced and sold each year. Annua

Reinvestment income, Other than zero coupon bonds, all fixed in...

Other than zero coupon bonds, all fixed income securities make periodic payments in the form of coupon interest. This coupon interest can be rei

Determine the scope of financial management, Scope of Financial Management ...

Scope of Financial Management The approach to scope and functions of financial management is divided, forpurposes of exposition, into two broad categories: (a) Traditional A

Credit spreads and the valuation of non-treasury securities, It is not easy...

It is not easy to determine the theoretical value of non-treasury securities. However, we can use the treasury spot rate for the valuation of non-treasury security.

#title.equity, what is equity ?

what is equity ?

Award and signing of contract, A w ard of contract In previous sub se...

A w ard of contract In previous sub section you learnt in what situations you can negotiate. Now let us discuss the procedure for awarding the contract. Below are the step

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