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Drawing power calculation
A Bank provided cash credit facilties to a contractor and Drawing power will be calculated on the basis debtor and stoc. meanwhile bank also extended Bank guarantee facilty. the contractor takes advance from the contractee on the basis of bank guarantee. whether debtors amount will be reduced by the amount received from contractee during calculation of DP.
plz help
Replies (4)
(stock +Debtors up to 90 Days ) - (creditors+bank Guarantee)*75%= DP
yes debtors wil reduce by the amount recived in advance.
Debtors of sister concern company should consider for DP calculation ?
And
What about the debtors of inter department of company would it same be considered for DP calculation or not ?
Plz... help me..
Hi
Debtors of Sister Concerns are now allowed by the Banks while calculating Drawing power. The same is with Inter Department debtor since the same is not sale to outsiders.
Ajay Gulati
CA and Insolvency Professional
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