The following is the Balance Sheet of ABC Ltd.
|
|
(Amount in $)
|
|
LIABILITIES
|
|
ASSETS
|
|
|
Share Capital
|
20,000
|
Fixed Assets
|
26,000
|
|
Retained Earnings
|
16,000
|
Investments
|
2,000
|
|
Long Term Loan
|
10,000
|
Stock
|
16,000
|
|
Trade Creditors
|
16,000
|
Trade Debtors
|
18,000
|
|
Accruals and Others
|
6,000
|
Cash and Others
|
6,000
|
|
Total
|
68,000
|
Total
|
68,000
|
Discuss the working capital requirements. Also explore the liquidity situation. What would be the working capital situation if the turnover doubles without change in the current terms of trade?