![]() Working Capital Turnover Ratio Formula can be interpreted as how much Working Capital is utilized per sales unit. With regards to Welspun India and Black Rose Ind it has a high Working Capital Turnover ratio, which means that they have a good scope of increasing the sales or, in other words, there is an underutilization of working capital.Īlok Industries have a negative Working capital Turnover ratio, which means the company can go out of funds if working capital is not increased with the given sales. Siyaram Silk and Orbit Exports have the best Working Capital Turnover ratio with the sales done, i.e., 2.61 and 2.93. Working Capital Turnover Ratio = 184.97 / 32.Working Capital Turnover Ratio = 130.23 / 44.45.Calculate the Working Capital Turnover Ratio and analyze the same. Below are the Balance sheet and Turnover of the companies. Working Capital Turnover Ratio – Example #3Īlok Industries, Welspun India, Siyaram Silk, Orbit Exports, and Black Rose Industries are peer companies. This is alarming to the company.įor the year March 2016, 2015, and 2014, the company has a positive Working Capital Turnover Ratio, which reflects the company has effective working capital management for sales done in that period. This will cause a shortage of funds and can cause a business to run out of money. Working Capital Turnover Ratio = 58.61 / 44.82įor the year March 2018 and March 2017 Working Capital Turnover Ratio is negative, which means that the company does not have sufficient short-term funds to fulfill the sales done for that period. ![]()
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