Q. 1. What is the Role of Central Bank in designing and implementing monetary and credit Policy? Highlight the main points of the latest monetary and credit policy declared by Reserve Bank of India.
Q2. XYZ Ltd. plans to sell 30,000 units next year. The expected cost of goods sold is as follows:
| Rs. per unit | |
| Raw material | 100 |
| Manufacturing expenses | 30 |
| Selling, administration & financial Exp. | 20 |
| Selling price | 200 |
The duration at various stages of the operating cycle is expected to be as follows:
| Rs. per unit | |
| Raw materials stage | 2 months |
| Work-in-process stage | 1 month |
| Finished goods stage | ½ month |
| Debtors stage | 1 month |
You are required to:
(i) calculate the investment in various current assets, and
(ii) estimate the gross working capital requirement if the desired cash balance is 5% of the gross working capital requirements.
Q3. Discuss in detail about Factoring of Receivables? What do you mean by “with recourse and without recourse Factoring”? Also explain the mechanism of Factoring.
Q4. “Working capital module simulates the integration of working capital components into the capital investment (CI) process”. Give the objectives and explanation of the operation of each module that forms a part of the working capital – capital investment process. Also highlight the sequential operation of the WC module.
Q5. Select a company of your choice and collect the financial statements of that company for past 3 years. Calculate the ratios which are relevant to the working capital management of that company.