ignou ms-41


Course Code : MS-41
Course Title : Working Capital Management
Assignment No. : MS-41/TMA /SEM-I/2020
Coverage : All Blocks


Note : Attempt all questions and submit this assignment to the coordinator of your study center  on or before 30th April, 2020.

1. Explain the meaning of Working Capital. How does inflation affect the size of
working capital, availability of working capital, and various components of working

2. An Enterprises’ current turnover is Rs. 10 lakh per annum. The enterprise currently allows a credit period of 40 days to its customers from the date of sale. The management of this enterprise wishes to adopt a more liberal credit policy, and it is exploring the following options:

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Additional information :-
– Selling price/unit is Rs 5.00
– Average cost/unit is Rs 3.00
– Variable costs/unit is Rs 2.00
– Current default rate is 1.5%
– Required rate of return is 15%
– A year consists of 360 days

You are required to suggest which of the above credit policies should be followed?


3. Taking a suitable example explain how maximum permissible bank finance is
assessed under the three methods of lending suggested by the Tandon Committee.

4. “Capital Investment Module and Working Capital Module use simulation techniques to represent the interactions among the capital investment and working capital variables” Discuss






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