Working capital gap

This query is : Resolved 

Querist : Anonymous (Querist) 23 June 2013

respected sir,
please some one clarify the concept "working capital gap" and how to caliculate it and significance of working capital gap in sanction of bank loans.
thanking you.

CMA Ramesh Krishnan (Expert)
23 June 2013

working capital GAP and permissible finance in two lending methods, first method of
lending will allow the MPBF 75% of the net working capital GAP which is Current assets
less current liabilities, Second method of lending will allow the MPBF 75 % the current
assets less current liabilities. So only the MPBF limit is the cash credit component of the borrower which generally known Drawing power (DP Limit). So this is very important
statement which decide the borrower`s borrowing limit from the bank

You need to be the querist or approved CAclub expert to take part in this query .

Click here to login now

Similar Resolved Queries :

× Online Coaching My Enrolled Courses
Articles Forum News Experts Exams Share Files Income Tax Accounts Career Corporate Law Service Tax Video Judgements Rewards Top Members Events Albums Find Friends Featured Feed Scorecard Bookmarks Mock Test Poll Notification Knowledge Finder Coaching Institutes Trainee Corner Jobs
close x
Download GST App    |    x