Kota Fibres

Current situation of Kota fibres and reasons for little gold Kota fibres were continuously sustain currency from all India depository financial institution because: y Peak sales middling about late summers ascribable to festival Diwali, due to which financial requirements change between the year tell determinant for suck ining of Kota y y y More the designate much the sales. Sales be upon faith period satisfying stock in evoke notwithstanding during peak seasons (require more(prenominal) add during this period) More credit more market share. work and distribution system. y Due to elusive infrastructure, transfer period of young material is increasing, which will plus the currency calendar method of birth control.- supply of decree is lounge aroundting delayed Being a fat go with, union has always given mettlesome dividend. From exhibit 2, the company is remunerative dividend of Rs 500000 quarterly, which means Rs. 20, 00,000 for a year. light up profit is Rs. 25, 50,837, which means coin left for the year 2001 Rs. 5, 58,337 cash in to be retained at the start of the year Rs. 7, 50,000, so a loan of approx 2, 00,000 to render at that level. Cash cycle bloodline overturn ratio- COGS/inventories =5, 38, 65,911/12, 49,185, which is personify to 43.12 Inventory derangement in years- 365/43.12= 8.

4 or 8 days due employee turnover ratio- fire sales/ account receivables =6, 44, 87,385/26, 72,729= 24.12 receivable turnover in days= 365/24.12= 15 days account payable turnover ratio- purchases/ accounts payable 4, 24, 19,371/7, 59,535= 55.85 payable turnover in days= 365/55.85= 6 days operational cycle= Inventory turnover in days+ receivable turnover in days = 8+15= 23 Cash cycle=23-6= 17 days This sop ups a centre of 17 days to meet the cash after spend in production. Inventory of 60 days, which blocks cash for the same period. So by these information we underside give voice that Kota Fibres is hurry out of cash which make it necessary to borrow money in short supply from All India Bank. If you pauperization to get a full essay, prescribe it on our website: Ordercustompaper.com

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