Question : Assertion (A): Current Liabilities are calculated by subtracting Working Capital from Current Assets.
Reason (R): Working Capital = Current Assets – Current Liabilities
Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)
Option 3: Assertion (A) is true but Reason (R) is False
Option 4: Assertion (A) is False and Reason (R) is correct.
Correct Answer: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)
Solution :
Working capital = current assets – current liabilities.
Current Liabilities = Current Assets - Working Capital
Current assets = Working capital + Current liabilities.
Hence option 1 is the correct answer.
Related Questions
Trending Articles/News
