FORMAT OF DETERMINANT OF WORKING CAPITAL

PARTICULARS
A) CYRRENT ASSETS Inventories Sundry debtors Cash and bank balance Loan and advances TOTAL CURRENT ASSETS B) CURRENT LIABILITIES Sundry creditors Deposits from agent & others Interest accrued Overdrawn in bank Advance from customer TOTAL CURRENT LIABILITIES NET WORKING CAPITAL(A-B)

AMOUNT
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX

WORKING CAPITAL FOR THE YEAR 2009 PARTICULARS

A) CURRENT ASSETS Inventories 2380565.45

AMOUNT

Sundry debtors Cash and bank balance Loan and advances TOTAL CURRENT ASSETS

165000.00 172500.00

2944308.55 B) CURRENT LIABILITIES Sundry creditors Other liabilities TOTAL CURRENT LIABILITIES NET WORKING CAPITAL(A-B) 5646172.45 68200.00 5714372.45 2770063.9

WORKING CAPITAL FOR THE YEAR 2010 PARTICULARS

A) CURRENT ASSETS Inventories Sundry debtors Cash and bank balance Loan and advances 6895131.4 1697230.49 647526.00 226243.10

AMOUNT

TOTAL CURRENT ASSETS B) CURRENT LIABILITIES Sundry creditors Other liabilities TOTAL CURRENT LIABILITIES NET WORKING CAPITAL(A-B) 9931812.56 142300.00 2944.90 9283.83

WORKING CAPITAL FOR THE YEAR 2009-2010 PARTICULARS

A) CURRENT ASSETS Inventories Sundry debtors Cash and bank balance Loan and advances TOTAL CURRENT ASSETS B) CURRENT LIABILITIES Sundry creditors Other liabilities Deposits from agent & others Interest accrued & not due on loans 638.73 433.96 762.61 121.81 695.51 4914.05 1864.69 5500.94 12975.19

AMOUNT

Advance from customer Out standing expenses TOTAL CURRENT LIABILITIES NET WORKING CAPITAL(A-B)

NIL 1858.07 3815.18

9160.01

WORKING CAPITAL FOR THE YEAR 2010-20011 PARTICULARS

A) CURRENT ASSETS Inventories Sundry debtors Cash and bank balance Loan and advances TOTAL CURRENT ASSETS B) CURRENT LIABILITIES Sundry creditors Other liabilities Deposits from agent & others Interest accrued & not due on loans Advance from customer 479.54 281.59 780.53 121.42 175.26 607.46 6873.78 1585.69 7470.97 16537.9

AMOUNT

Advance received to wards certified emission Out standing expenses TOTAL CURRENT LIABILITIES NET WORKING CAPITAL(A-B)

1237.54 2259.73 5335.61 11202.29

TABLE OF CONTENTS: YEAR 2007-2008 2008-2009 2009-2010 2010-2011 NET WORKING CAPITAL 6659.32 9283.83 9160.01 5335.61

N E T W O R K IN G C A P ITA L 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 2007-2008 008-2009 009-2010 010-2011 2 2 2 N E T W O R K IN G C A P ITA L

CHANGE IN WORKING CAPITAL

PERTICULARS A) CURRENT ASSETS Inventories Sundry debtors Cash and bank balance Loan and advance TOTAL CURRENT ASSETS B) CURRENT LIABILITIES Sundry creditors Other liabilities Deposits from agent and others Interest accrued & not due on loans Advance from customers Advance received to wards certified emission Outstanding expenses TOTAL CURRENT LIABILITY 1858.07 3815.18 2259.73 5335.61 401.66 1520.43 NIL NIL 175.26 1237.54 175.26 1237.54 638.73 433.96 762.61 121.81 479.54 281.59 780.53 121.42 (159.19) (152.37) 17.92 (0.39) 695.51 4914.05 1864.69 5500.94 607.46 6873.78 1585.69 7470.97 (88.05) 1959.73 (279) 1970.03 3562.71 2010 2011 WORKING CAPITAL

12975.19 16537.9

NET WORKING CAPITAL (A- 9161.01 B)

11202.29

2041.28

RATIO ANALYSIS

RATIO ANALYSIS
MEANING:
Ratio analysis is a Widely used tool of FInancial analysis. It is deFIned as the systematic use of ratio to interpret the FInancial statements so that the A strength and Weaknesses of a firm as Well as its historical performance ' and current financial condition can be determined. The term ratio refers to the numerical or quantitative relationship between two variables.

OBJECTIVE OFRATIO
T 0 make inter business comparisons T 0 make comparisons across financial periods It helps in the financial forecasting and planning activities To indicate with trends in the financial solvency of the firm

TYPES OF RATIO

 Current ratio Inventory turnover ratio Creditors turnover ratio Debtors turnover ratio Gross profit margin ratio

CURRENT RATIO
The current ratio one of the best known measures of Financial Strength. It is Figured as shown below.Formula for current ratio Current ratio =total current assets/total current liabitity
Year Current assets Current liability Current ratio 2007-08 10015.28 2008-09 12228.71 2009-10 12975.19 2010-2011 16537.9

3355.96

2944.90

3815.18

5335.61

2.98

4.15

3.58

3.11

Interpretation; the current ratio is decreased in 2010-2011 comparing the

past year it show the ability to manage the current liability which in turn shows the efficiency of the management is not good

INVENTORY TURNOVER RATIO

It indicates the efficiency of the firm in producing the selling of its 0product. This ratio indicates how fast inventory is sold. A high ratio is good from viewpoint of liquidity and vice versa. A low ratio would signify that inventory does not sell and stay on the self or in warehouse for along time.

Formula for Inventory turnover ratio

I T R=net sales/inventory Year Net sales ITR 2007-08 54694.52 86.4 2008-09 65066.20 686.35 94.8 2009-10 71467.47 695.51 102.75 2010-11 89291.54 607.46 146.99

Inventories 633.06

Interpretation; we can see the inventory turnover ratio has increased on the
year 2011 compare to all years. That is good trend has the company is now turning the inventory into finished goods more frequently has compare to previous years.

CREDITORS TURNOVER RATIO

it is the ratio between the sales and creditors or net credit purchase and average amount of creditors. It is an important tool of analysis as a firm can maintain minimum amount of current assets, as credit from suppliers is easily available. Formula for creditor turnover ratio

C T R=net sales/creditors Year 2007-08 2008-09 65066.20 1612.56 40.3 2009-10 71467.47 638.73 111.8 2010-11 89291.54 479.54 182.2

Purchases 54694.52 Creditors 2222.75 CTR 24.6

Interpretation; low ratio reflect liberal credit terms granted by suppliers, while low ratio shows that account are settled equally, and it shows the minimum ratio in the year 2011. the ideal ratio should be more.

DEBTORS TURNOVER RATIO

It indicates how many times debtors turnover each year. Generally, the higher the ratio of debtor turnover ratio, the more Efficient is the management of credit. The ratio measured how will reveal the days of debts to be collected. Formula for debtors turnover ratio

DTR=net sales/debtors Year Net sales Debtors DTR 2007-08 54694.52 2922.32 18.7 2008-09 65066.20 4459.29 14.6 2009-10 71467.47 4914.05 14.5 2010-11 89291.54 6873.78 12.9

Interpretation: in that low ratio indicates of shorter time gap between credit
sales and cash collection. A low ratio shows that debts are not being collected rapidly. So the standard norm of law ratio reveals that company has not efficient in management of debtors.

GROSS PROFIT MARGIN RA TIO

Gross profit margin ratio is the result of relationship between price, Sales, volume and cost. A change in gross profit margin can be due to Changes in any of these

factors. It represents the limit of beyond which fall in sales price are out side and tolerance limit Formula for GPMR GPMP=gr0ss profit/net sales *100 Year 2007-08 2008-09 534.67 65066.20 0.82 2009-10 67020.17 71467.47 0.93 2010-11 82177.62 89291.54 0.92

Gross profit 1253.48 Net sales GPMR 54694.52 2.29

s Interpretation: the GPMR is decrease in the year 2011 compare to last year. It
depicts a bad trend for the company. In this case both sales and the gross profit have decreased but have increased competitively more.