which of the following is not a technique of estimating working capital requirements: 1.cash forecasting method. 2.repression analysis method. 3.operating cycle method. 4.percentage of sales method
Answers
Answer:
The following points highlight the top five methods for estimating working capital requirements, i.e., 1. Percentage of Sales Method 2. Regression Analysis Method 3. Cash Forecasting Method 4. Operating Cycle Method 5. Projected Balance Sheet Method.
All of these are techniques of calculating working capital requirements.
A firm should appraise ahead of time with regards to how much net working capital will be needed for the smooth activities of the business. Really at that time, it can bifurcate this prerequisite into super durable working capital and transitory working capital. This bifurcation will help in concluding the financing design i.e., how much working capital ought to be financed from long haul sources and how much be financed from momentary sources. This way to deal with gauging the working capital necessity depends on the way that the working capital for any firm is straightforwardly connected with the business volume of that firm.