FM -working capital
This query is : Resolved
27 December 2009
if we hav to find "max perm. bank finance" as per 3rd norm of tandon committee in which we have to use core current assets ....how will we find MPBF?
27 December 2009
Refer the following example:
Total Current Assets : 370
Less:Core Current Assets : 95
(Core Current Assets represents minimum long term working capital)
Real Current Assets : 275
Less 25% margin -69
---
206
Less:Current Liabilities 150
---
56
Working Capital Gap is Rs.370-150 = 220
But Maximum Permissible Bank Finance is only Rs.56
Total Current Assets : 370
Less:Core Current Assets : 95
(Core Current Assets represents minimum long term working capital)
Real Current Assets : 275
Less 25% margin -69
---
206
Less:Current Liabilities 150
---
56
Working Capital Gap is Rs.370-150 = 220
But Maximum Permissible Bank Finance is only Rs.56
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