Question:
Calculate the operating cycle of company which gives the following details relating to its operations.
| Particular |
Rs.
|
| raw material consumption per annum |
842000 |
| Annual cost of production |
1425000 |
| Annual cost of sales |
1530000 |
| Average value of current assets held: |
|
| raw materials |
124000 |
| Work in progress |
72000 |
| Finished goods |
122000 |
| Debtors |
260000 |
| Annual sales |
1950000 |
The company gets 30 days credit from its suppliers. All sales made by the firm are on credit only. You may take one year as equal to 365 days.