00:01
We need to calculate the gross and net operating cycle for vishal and companies ltd.
00:05
So, for that firstly evaluating gross operating cycle known as goc.
00:16
So, for that evaluating dsi first.
00:20
So, for that also we will evaluate average raw material inventory.
00:34
It is evaluated as operating raw material which is of the value 2 lakh wherein we add closing raw material value which is 3 lakh divided by 2.
00:50
So, equating it we get the value to be 2 ,50 ,000.
00:56
Then evaluating dsi value.
00:59
So, dsi value is evaluated as average raw material inventory which is 2 ,50 ,000 divided by annual purchase of raw material which is 32 lakh wherein we add manufacturing expenses which is of the value 5 ,50 ,000 multiplied by 360.
01:29
So, equating it we get the value to be 15 days.
01:34
Then next evaluating dso.
01:37
So, for that evaluating firstly average accounts receivable value.
01:52
So, it is 2 ,50 ,000 dollar which is average raw material inventory wherein we add 2 ,15 ,000 dollars divided by 2.
02:04
So, equating it we get the value to be 2 ,32 ,500.
02:10
So, dso value is then evaluated as average accounts receivable which is of the value 2 ,32 ,500 divided by sales value.
02:21
It is 44 ,80 ,000 multiplied by 360...