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

State the advantages of ias 14 risk and return approach, IAS 14 "risk and r...

IAS 14 "risk and return approach" Advantages Highlights the profitability, risk and returns of each segment. Information is more comparable with other entities.

Nature of the business, Q. Nature of the business? The working capital ...

Q. Nature of the business? The working capital requirement of the firm basic depends upon the nature of the business. public utility undertaking like the water supply and rai

#title Find the NPV of 2 Projects, Woody Construction is considering a new ...

Woody Construction is considering a new 3 year expansion project that requires an initial fixed asset investment

How foreign subsidiary’s financial structure become relevant, Under what ci...

Under what circumstances will the foreign subsidiary’s financial structure become relevant? The subsidiary’s own financial structure will become applicable when the parent firm

Manage Budget and Financial Report, Complete the financial reporting for ea...

Complete the financial reporting for each period and develop recommendations using the templates provided. Procedure 1. Read the case study. 2. Complete the financial reports

Cash flows from portfolio of us standard mortgages, The cash flows ...

The cash flows from a portfolio of US standard mortgages have the characteristic of being uncertain. The cash flows from the mortgage consists of three comp

Enhance or maintain its image and reputation, a) Marketing might be vital t...

a) Marketing might be vital to an organisation such as WHSG for several reasons, including: • The need to be a focus for the right kind of students to the school (there are riva

Leveraged buyout (lbo), Leveraged Buyout (LBO) Acquisition of an organi...

Leveraged Buyout (LBO) Acquisition of an organization through the accumulation of 70 % or more of the organizations total capitalized debt.

Net present value (npv), Net Present Value (NPV) : In this technique, f...

Net Present Value (NPV) : In this technique, future cash flows are discounted to the present and then compared with the investment outlay. The basic discount rate is generally

Financial equivalent of the balance, The Federal Minister for the Environme...

The Federal Minister for the Environment is worried about the Greenhouse Effect, one outcome of which would be that Adelaide would have a subtropical climate by the year 2015. This

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