Advertisements
Advertisements
Question
A firm’s current ratio is 3.5 : 2. Its current liabilities are ₹ 80,000. Its working capital will be ______.
Options
₹ 1,20,000
₹ 1,60,000
₹ 60,000
₹ 2,80,000
MCQ
Fill in the Blanks
Advertisements
Solution
A firm’s current ratio is 3.5 : 2. Its current liabilities are ₹ 80,000. Its working capital will be ₹ 60,000.
Explanation:
Current Ratio = `"Current Assets"/"Current Liabilities"`
`3.5/2` = `("Current Assets")/(80,000)`
Current Assets = `3.5/2 xx 80,000`
= 1.75 × 80,000
= ₹ 1,40,000
Working Capital = Current Assets − Current Liabilities
= 1,40,000 − 80,000
= ₹ 60,000
shaalaa.com
Is there an error in this question or solution?
