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How do u do the working capital changes, looks complex?]
Wats the total loan amount?
How do u arrive at the net interest payable amount ?
just do for one yr I will grasp the ideaI must have missed it – I had a lot to do this morning.
Note (iv) of the question says that inventories etc, increase in proportion to sales, and note (i) of the question says that sales increase by 9% then 8% etc..
So, for example, inventory in 20X5 = 448 x 1.09 = 488, and in 20X6 is 488 x 1.08 = 527 and so on. Same for the others.
The loan is 580 (per the question, under non-current liabilities). In addition there are short term loans and overdraft – these are the ‘missing figure’ each year so as to make the SOFP balance.
The interest is 8% on the long-term loan plus 7% on the short-term borrowings at the start of the year (as per notes (vi) and (v) of the question.
So in 20X5 it is (8% x 580) + (7% x 230) = 62.5Its been long time since I have asked this question. Thnks for the reply just saw it 🙂
It was only 4 days ago (and I did reply to it the next day when you pointed out that I had missed it) 🙂
Hello there
Need your help here on deriving the interest amount for subsequent years.
If the short term loans & overdraft are balancing figure from the SOFP, i would need calculate the reserves as well. However, without the interest charge figure, i couldnt calculate the reserve.
Can you assist on this matter? Thanks.
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