Cash Cycle – Knowsia

MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

Question

a. Working capital is generally understood to mean the difference between current assets and current liabilities. Explain the term working capital cycle. (2 Marks)
b. List FIVE factors that determine the working capital requirements of a firm. (5 Marks)
c. GLORY Limited has provided you with the following data regarding next year’s budget that has just been presented to the board by the financial controller of the company:

Budgeted Average Amount Outstanding	N
Inventory: Raw materials	480,000
Work-in-Progress	360,000
Finished goods	244,800
Receivables	600,600
Payables	(422,400)
Budgeted Average Working Capital	1,263,000

The following are available daily averages:

Daily Averages	N
Revenue	9,240
Cost of Sales	7,200
Purchases of raw materials	3,840

You are required to compute the working capital cycle based on the above figures. (13 Marks)

Answer

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Tags: Cash Cycle, Current Assets, Current Liabilities, Working Capital, Working Capital Management
Level: Level 1

Topic: Budgeting
Series: NOV 2014

MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

Question

The working capital cycle starts and ends with ONE of the following:

A. Cash and Payables
B. Inventory and Receivables
C. Work in Progress and Inventory
D. Cash and Inventory
E. Cash and Receivables

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cash Cycle, Cash Management, Inventory, Receivables, Working Capital
Level: Level 1

Topic: Decision-making techniques
Series: NOV 2014

MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

Question

Budgeted Average Amount Outstanding	N
Inventory: Raw materials	480,000
Work-in-Progress	360,000
Finished goods	244,800
Receivables	600,600
Payables	(422,400)
Budgeted Average Working Capital	1,263,000

The following are available daily averages:

Daily Averages	N
Revenue	9,240
Cost of Sales	7,200
Purchases of raw materials	3,840

You are required to compute the working capital cycle based on the above figures. (13 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cash Cycle, Current Assets, Current Liabilities, Working Capital, Working Capital Management
Level: Level 1

Topic: Budgeting
Series: NOV 2014

MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

Question

The working capital cycle starts and ends with ONE of the following:

A. Cash and Payables
B. Inventory and Receivables
C. Work in Progress and Inventory
D. Cash and Inventory
E. Cash and Receivables

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cash Cycle, Cash Management, Inventory, Receivables, Working Capital
Level: Level 1

Topic: Decision-making techniques
Series: NOV 2014

Question Tag: Cash Cycle

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MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

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MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

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MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

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MI – Nov 2014 – L1 – SB – Q1 – Budgeting

This question focuses on defining working capital, explaining the working capital cycle, and calculating it based on given data.

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MI – Nov 2014 – L1 – SA – Q5 – Decision-making techniques

Working Capital, Cash Cycle, Inventory, Receivables, Cash Management

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