Question

Statement of Financial position 31 December 2019.                                   &

Statement of Financial position 31 December 2019.
                                          2019.           2018
Non current assets.      1000000. 800000
Inventory                         330000.    100000
Debtors.                           396000.    100000
Cash and cash equivalent. 242000 50000
Creditors                         198000.      400000

Sales for 2020 is projected to be R3 000 000

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Answer #1

SOLUTION:-

Working Capital = Current Assets - Current Liabilities

For the year 2019

Current Assets = (Inventory + Debtors + Cash and Cash Equivalent)

= (330000 + 396000 + 242000) = 968,000/-

Current Liabilities = Sundry Creditors = 198000

Working Capital = CA - CL = 968000 - 198000 = 770,000

So Working Capital as a percentage of Sale = (770000/2200000)*100=35%

Now, For the year 2020

Projested Sales for 2020 = 3000,000

So, Working Capital Requirement for 2020 = 3000000*35%

= 1,050,000

THANK YOU, if any queries please leave your valuable comment on comment box......

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