Question : A firm's current ratio is 3: 1. Its current liabilities are Rs 80,000 its working capital will be
Option 1: Rs 1,20,000
Option 2: Rs 1,60,000
Option 3: Rs 40,000
Option 4: None of the above
Answer (1)
24th Jan, 2024
Correct Answer: Rs 1,60,000
Solution : Answer = Rs 1,60,000
C. Ratio = 3:1
C.Liab = 80,000
C.Ratio = $\frac{C.A.}{C.liab}$
$\frac{3.}{1}$= $\frac{C.A.}{80,000}$
C.A. = 2,40,000
Working Capital = 2,40,000- 80,000 = 1,60,000.
Hence, the correct option is 2.
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