Dear students get fully solved assignments Send your semester & Specialization name to our mail id : help.mbaassignments@gmail.com or call us at : 08263069601

1. Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601
MS – 41: Working Capital Management
ASSIGNMENT
Course Code : MS-41
Course Title : Working Capital Management
Assignment No. : MS-41/TMA /SEM-I/2016
Coverage : All Blocks
Question 1: Collect the Financial Statements of any two firms from the
same industry for 2014-2015 and calculate their Efficiency, Liquidity and
Structural Ratios. Based on these ratios, give your views on the working
capital management of these firms.
Solution: Financial statements are valuable summaries of financial activities because
they can organize information and make it easier and clearer to see and therefore to
understand. Each one—the income statement, cash flow statement, and balance
sheet—conveys a different aspect of the financial picture;
Question 2: The Ratan Corporation sells goods earning a gross profit of

2. 25% on sales. You are required to prepare a Statement showing the
Working Capital requirement of the company adding 10% margin
for
contingencies from the annual figures given below:
Rs.
Sales 3,00,000
Materials used 1,08,000
Wages 96,000
Manufacturing expenses 1,20,000
Administrative and other expenses 30,000
Selling and distribution expenses 18,000
Depreciation 12,000
Income tax payable in four instalments of
which one falls in the next financial year 60,000
Additional Information is as follows:
Credit given by suppliers of materials is 2 months
Credit allowed to customers is 1 month
Wages are paid half month in arrear
Manufacturing and administrative expenses are paid one month in
arrear
Selling and distribution expenses are paid quarterly in advance
The company wishes to keep one month stock of raw material
and also of finished goods
The company believes in keeping cash of Rs. 50,000 including

3. the overdraft limit of Rs. 20,000 not yet utilized by the
company.
Solution: Calculation of working capital requirements
Question 3: (a) Why are the Letters of Credit (LCs) known as non fund
based working capital finance and what role do they play in facilitating
trade?
Solution: Letters of Credit (LCs) known as non fund based working capital finance
because Letter of credit and bank guarantee has a very thin line of difference. Bank
guarantee is revoked and bank makes payment to the holder in case of non
performance of the opposite party whereas
(b) Is it right to say that the LCs do not involve any financial obligation or
risk on the part of the issuing banker? Give your comments.
Solution: It is not right to say that the LCs do not involve any financial obligation or
risk on the part of the issuing banker because Letter of Credit is generally required when
the seller of goods and services deals with unknown parties or otherwise feels the necessity
to safeguard his interest. Under such circumstances, he asks the buyer to arrange a letter of
credit from his banker. The banker issuing the L/C commits to make payment of the amount
mentioned therein to the seller of the goods
Question 4: What do you mean by ‘Short Term Integrated Funds
Planning’? Discuss whether this planning is really practiced in the
corporate world in India.
Solution: Short Term Integrated Funds Planning
(A) Current Assets Rs.
225000 ∗
1
Debtors at cost (1 month) 225000 187501 2

4. The term financial meaning means different things to different managers. It depends
upon the nature, size and organizational structure. In general terms, financial planning
mainly involves anticipating the impact of operating and financial policies on the future
financial position of the organization and formulating appropriate responses in the light
of the same.
Question 5: Identify the major players in the Indian Money Market.
Discuss the major hurdles they face in their operations.
Solution: Major players in the Indian Money Market
A money market is a market for borrowing and lending of short-term funds. It deals in
funds and financial instruments having a maturity period of one day to one year. It is a
mechanism through which short-term funds are loaned or borrowed and through which
a large part of financial transactions of a particular country or of the world are cleared.
Dear students get fully solved assignments
Send your semester & Specialization name to our mail id :
help.mbaassignments@gmail.com
or
call us at : 08263069601