BUSF_A01.qxd

Chapter 13 • Management of working capital purchase price of the inventories themselves as this is defined by the annual usage a ...

Inventories order size increase, the annual costs of placing orders decrease but holding costs increase. Total cost drops as inv ...

Chapter 13 • Management of working capital Note that incorporating a safety buffer means that the average inventories holding le ...

Inventories model can be extended to deal with most factors that the simpler version ignores. Several of the references at the e ...

Chapter 13 • Management of working capital may be stated either in terms of physical units of inventories or in money terms. It ...

Just-in-time inventories management 14.3 Mergers: the practicalities The JIT system can only be reliably established where there ...

Chapter 13 • Management of working capital Nissan Motors UK Ltd, the UK manufacturing arm of the Japanese car manufac- turer, ha ...

Trade receivables Assessing the potential customer’s creditworthiness It is usual before granting credit to a new customer, or p ...

Chapter 13 • Management of working capital Loss of customer goodwill If its competitors grant credit it will be difficult for a ...

Trade receivables approach that could also be used is to look out for customers who are taking longer than usual to pay; this ma ...

Chapter 13 • Management of working capital to its settlement will reduce the value of the amount owed, in terms of the home curr ...

Cash (including overdrafts and short-term deposits) Clearly, cash management is one of the key roles in any organisation of any ...

Chapter 13 • Management of working capital especially where the particular commodity is one that is vital to continuing operatio ...

Cash (including overdrafts and short-term deposits) A business plans to use £20,000 of cash during the forthcoming year. It hold ...

Chapter 13 • Management of working capital being granted. Where overdrafts are being used, as in our example, to overcome tempor ...

Cash (including overdrafts and short-term deposits) A business has the following plans for the next few months: 1 Sales revenue: ...

Chapter 13 • Management of working capital Make judicious use of bank overdraft and deposit accounts Bank overdrafts should be a ...

Trade payables a new piece of plant is purchased at the end of an accounting year, the tax relief will first manifest itself in ...

Chapter 13 • Management of working capital Restrictions Many suppliers insist that, to be granted credit, orders must be of some ...

Summary Working capital (WC) lWC =inventories +trade receivables +cash −trade payables. lAn investment in WC cannot be avoided i ...