Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Q. What are the Benefits of Holding Inventories?
(1) Timing of Demand and Supply: - Requirement to hold inventory of raw materials arises because it isn't possible for a firm to procure raw materials whenever it is needed. If the firm is guaranteed of supply of raw material without delay at the rate it is used in its manufacturing process it need not to hold stock of raw materials. However in actual practice a time lag exists between demand of raw materials in manufacturing process as well as its supply. Provider of raw material to the firm mat as well is delayed because of such factors as transport problems, strike, short supply etc. Thus the firm must maintain adequate inventory of raw material to run its manufacturing process regularly. Likewise need to hold inventory of finished goods arises because the rate of manufacturing and the rate of sale don't match. A firm can't manufacture the goods immediately on demand by customers.
(2) Quantity Discounts: - Raw materials are necessary as and when production process is run. However instead of procuring raw materials in small quantities at the time of each production run firm may purchase large quantities of raw material in advance to acquire quantity discounts of bulk purchasing. This results in a important saving in costs.
(3) Expectancy of Price Rise: - Anticipation of price rise may as well necessitate purchasing and holding of raw material inventories.
(4) Reducing Ordering Cost: - These costs comprise the cost of preparing transporting cost, purchase orders, receiving costs, inspecting costs etc.
These cost raise in proportion to number of order placed. Thus a firm may purchase raw materials in excess of its immediate requirements by placing one bulk order to reduce the ordering costs. This as well results in accumulation of raw material inventory.
Secondary Market The secondary market is also referred to as the stock market where dealings in shares are taken up. It helps the shareholders to find buyers for trading. Thus,
X & Y is desirous to purchase a business and has consulted you, and one point on which you are asked to advice them, is the average amount of working capital which will be required
Q. Show Certificates of Deposits? Certificates of Deposits: Certificate of deposits is papers issued by banks acknowledging fixed deposits for a specified period of time. CPs i
Q. What do you signify by Cost of Capital? What do you signify by 'Cost of Capital'? What is its meaning and what are the problems in determination of cost of capital? Ans.
FIXED ASSETS 200 000 LONG TERM LIABILITIES CURRENT ASSETS CASH 40 000 LOAN
Variance Analysis: In its commonest form variance analysis is the process of comparing budgeted financial performance (or financial goals) against actual financial performance.
Question : (a) Lucky Corporation is considering an investment in one of the two mutually exclusive proposals: Project A which involves an initial outlay of Rs 170,000 and Proj
Market Efficiency Though there are various markets present in the financial system, the ease with which the transfer of funds take place depends on the level of efficiency pres
Determine the Limitations of the traditional approach Limitations of the traditional approach were not entirely based on treatment or emphasis of different aspects. In other wo
What are the objectives of the Insurance Companies? Insurance companies: The main objective of insurance companies is to prevent individuals and firms (termed as policy-h
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd