SOLVED NUMERICAL PROBLEMS
  1. A firm sells its final products for Rs 2,00,000 per month, 80% of which is sold on net 30 terms. The cost of material accounts for 60% of the sale value and the operating cost amounts to 10% of the sale value. The firm has to make interest payment of Rs 10,000 every month. Find the monthly cash requirements of the firm.

    Solution

    Proforma Cash Budget

    Surplus cash may be invested in near-cash assets.

     

  2. A firm expects that the adoption of lock-box system will shorten the cash collection by 3 days. Credit sales amount to Rs 7,20,00,000 per year billed on a continuous basis. The cost of lock-box system is Rs 50,000. The ...

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