It makes 20% sales on cash basis. for purchasing raw material and supplies, payment of wages, salaries and other sundry expenses. (C) 28,426 2,80,000 = 1.4y Income tax payable 56,250 For example, a service company that does not carry inventory will simply not factor inventory into its working capital calculation. (A) 28,246 (A) Fixed Assets How Does Business Age Affect Business Loan Eligibility? Cash sales = 5,00,000 But, the need for your business to meet the demands of permanent working capital is something that wont change. Scroll down to learn what permanent capital is and understand why its so important for the financial health of your small business. (D) 0.435; 0.405, Question 134. (B) 4,00,000 It might even go bankrupt. Creditors Payment Period, Question 99. What are the core current assets of Deelip Ltd? (A) 12,98,625 (C) an example of high risk high (potential) profitability asset financing. (D) 59 days Question 135. Answer: (B) Cost of Production, Question 90. Working capital relies heavily on correct accounting practices, especially surrounding internal control and safeguarding of assets. (D) All of the above except (4), Question 6. But do you know what it is? (A) Current capital or circulating capital, Question 61. (B) 32,830 Answer: (C) 80,000 drums (D) 12,00,000 Avatar Corp solves its cash shortage by paying its bills a week late but loses a 1% discount by doing so. (C) Not change, Question 87. There is deterioration in the management of working capital of XYZ Ltd. What does it refer to? A firm's permanent working capital refers to the: Multiple Choice difference between fixed assets and current assets. Sorry, we can't send you the article yet. Question 41. Opening stock + Purchase Closing stock = Cost of goods sold (D) 8,00,000 (B) 49,29,313 D. amounts that must be held to meet debt covenants. Answer: (D) Variable working capital, Question 22. Answer: (D) None of these (B) Decrease in inventories When a working capital calculation is positive, this means the company's current assets are greater than its current liabilities. (B) How many time account receivable is collected, Question 78. Purchase of stock for cash will current ratio. Current Ratio vs. Quick Ratio: What's the Difference? Net working capital 2,80,000 Opening stock = 9,90,000 (A) 24,00,000 (C) 16,000 Dont get it twisted, permanent working capital is something any/every successful business owner is aware of. Current liabilities = ? (B) Quick ratio (D) (B) & (C) is correct. (A) Differential working capital Which of the following statement is correct? (A) Added to gross working capital Assume the level of Core Current Assets to be 60 lakhs. (B) Regression analysis method (A) Annual Sales Working capital = 11,70,000 + 9,58150 + 26,65,000 + 55,12,000 + 6,00,000 17,55,000 14,95,000 = 76,55,750. D) firm uses no equity in its capital structure. The working capital ratio, also known as the current ratio, is a measure of the company's ability to meet short-term obligations. (B) Net working capital. Answer: Gross working capital refers to (C) is required at the time of the commencement of business Answer: (A) 18,000 (A) 28,750 (B) the firm may not be able to meet its liabilities Answer: The current ratio is a liquidity ratio that measures a companys ability to cover its short-term obligations with its current assets. Answer: B. minimum difference between current assets and current liabilities. Difference between current assets and current liabilities B. (C) 19 days (A) To maintain the optimum levels of investment in current assets. 57,41,813 = 0.75 (x 32,50,000) Answer: Simple enough, right? Instead of Annual Factory Cost WIP Conversion Period can be calculated taking . as base. 3,15,000 = [0.75 (9,60,000 x)] 3,60,000 Creditors + Bifis Payable Account Payable Fixed assets are 6,00,000 and the firm plans to maintain a 50% debt-to-assets ratio. (A) Hard current assets (A) 450 1akhs Note: 1 Year = 360 days Following details are available for Pratik Ltd. Statement I: Maintaining adequate working capital is not just important in the short-term. (D) All of the above, Question 63. (A) 1.25, Question 103. (2) Stock of WIP Bills receivable & Bills payable were 60,000 and 36,667 respectively. Answer: A company has negative working if its ratio of current assets to liabilities is less than one (or if it has more current liabilities than current assets). If you are appointed to prepare working capital statement for the company, then how much outstanding wages you will take while preparing working capital statement? (D) 77,55,650 (A) Current capital or circulating capital Select the correct answer from the options given below. A firm's permanent working capital refers to the: A. What is difference between current ratio and quick ratio? (D) lower risk with lower liquidity Which of the following is/are method of maximum permissible bank finance as recommended by the Tandon Committee? (3) Short Term Investments (C) Operating cycle, Question 13. (B) 6.77, Question 95. Current ratio =\( \frac{4,00,000}{3,00,000}=1.33\), Question 97. If annual sales figure is not available then which of the following figure will be taken as base for calculation of debtors? Annual credit sales Cash sales Debtors Bills receivable Finished goods Collection Period = ? (D) All of the above, Question 21. (B) 10,00,000 (D) 70 days (A) 2,00,000 (C) is the amount of current assets required to meet a firms long-term minimum needs. Question 46. Working Capital Leverage. (B) Cost of Production An example of this is a firm's 100,000 Working Capital, deducting 200,000 to 300,000 in current liabilities. Answer: (C) 5,65,000 (B) 37,80,000, Question 117. It might indicate that the business has too much inventory, not investing its excess cash, or not capitalizing on low-expense debt opportunities. (B) Cost of Production, Question 89. One production process cycle is completed in two month. Question 57. Answer: (D) 18.67% (A) greater liquidity and lower risk Permanent sources Working Capital Management Working capital or short-term financial management refers to the administrators and control of more liquid resources to ensure sufficiency in covering day to day business operations, including anticipated contingencies. A conservative policy means (B) Work-in-progress capital On the other hand, if the radio, window, or A/C stops working, the car will still do its job. Answer: (D) 1,92,50,000 (A) Added to gross working capital. (A) 22,125 Become provides you with easy online application services to access loans from third party lenders. (A) Acid test days, Question 72. 2,80,000 = 2.4y y (B) 42,12,000 (C) Coverage ratio refers to the length of time allowed by a firm for its customers to make payment for their purchases. (C) 75,75,000 y = 1000 (B) lower return and risk In this case, the: If the Statement of Sources and Uses of Cash shows a decrease in cash balance, which of the following changes might have. (C) 29,00,000 the minimum amount of working capital needed to maintain a cashflow; enough money to purchase materials, produce inventory, turn that inventory into profits, use those profits to purchase more materials, and so on. Any amount over and above the permanent level of working capital is known as working capital. Answer: Raw Material Consumed = 8,42,000 (B) Over trading, Question 30. Operating cycle days of Ramji Ltd. is 167 days. Cash management is the process of managing cash inflows and outflows. Question 55. Raw material conversion period, Question 92. x = Current Assets = 2,00,000 2.4 = 4,80,000, Question 111. What does the accounts receivable turnover ratio tell us? The best ratio to evaluate short-term liquidity is: (C) 10,10,000 (B) Current Liabilities, Question 67. How much outstanding wages will appear in working capital statement? (A) (1) only (D) 1,10,00,726 (D) Company has no working capital Also given, Dividend paid on shares Rs 15,000 and Interest paid on debentures Rs. Answer: (A) 62,500 (B) 15,000, Question 107. Working capital = 8,40,000 (B) Sales (B) Profitability Ratios (A) where the firm relies heavily on short term bank finance. (C) current assets minus inventories. (C) 36,40,000 (D) 28,250 (D) 4.43 month Working capital means the funds (capital) available and used for day-to-day operations (working) of an enterprise. TOP 21 Working Capital Management MCQ With Answers Admin MCQ Financial Management, MBA MCQ Given below are Working Capital Management MCQ with answers updated in 2021. (A) 75% of (Current Assets Current Liabilities), Question 38. Disclaimer: The information contained in this article is provided for informational purposes only, should not be construed as legal advice on any subject matter and should not be relied upon as such. Question 86. (B) 10,00,000 Well, consider the fact that permanent working capital actually, The precise value of your businesss fixed working capital will be relative to the size of your business, as well as the value of your current assets and your current liabilities. (C) Both (A) and (B) To be clear, that number will change as your company grows and as your assets and liabilities change. (A) an example of moderate risk-moderate (potential) profitability asset financing. (D) 12,00,000, Question 110. (B) 10,00,000 Peter Berngarten owns 100 shares of. (B) 11,667 From the following data calculate finished goods conversion period for the years 2019 & 2020. Answer: Cost structure per unit: Most of the time, long-term financial options are used to get fixed working capital. What will be the amount of maximum permissible bank finance as per first method of Tandon Committee Norms? overheads remains same hence even at increased production of 48,000 packets Select the correct answer from the options In the corporate finance world, current refers to a time period of one year or less. (A) How often account receivable received (B) 24.00% (B) Core current assets Direct expenses 5% The following information is available for your calculation. (B) Current Liabilities (D) All of the above .. refers to the difference between current asset and current liabilities. What are the aspects of working capital management? Working capital =. Working capital in this case is (D) 0.95 All figures are in thousands of dollars. (B) 15,000 51. (A) Reserve Working Capital (A) Liquidity, Question 39. (B) 61 days, Question 124. (D) 7.66 (C) 10,000, Question 122. (C) 5,83,000 The Online Marketplace for Business Lending. Total sales = 24,00,000 + 5,00,000 = 29,00,000, Question 112. Finished goods stock and WIP stock will appear in balance sheet and working capital of the company at Which best describes the gross margin ratio? Three alternative current assets policies are under consideration 40%, 50% and 60% of projected sales. (D) None of the above (A) the firm may not be able to its long term finance A company has prepared its annual budget, relevant details of which are reproduced below: Working Capital Turnover measures the relationship of Working Capital with: (B) Current assets & current liabilities, Question 70. Current liabilities: 3,73,750 (A) Trade-off between profitability and risk. Raw material stock velocity 79 days Interest rates are 12% p.a. Answer: D. amounts that must be held to meet debt covenants. Answer: What Is Cash Management in Accounting and Why Is It Important? (B) current assets minus current liabilities. Working Capital Cycle. 1,20,000 + Purchases 1,80,000 = 3,60,000 Method 1: 75% of (Current Assets Current Liabilities) Which of the following will be considered while calculating working capital? Answer: Answer: Answer: (C) 29 days (C) 200 Last, working capital assumes all debt obligations are known. Regardless of the exact dollar amount, what remains true is that if your businesss capital were to fall below the fixed working capital requirement its not good. (C) 315 Iakhs (A) Company has poor credit policy Current assets & current liabilities of Deelip Ltd. are 9,60,000 and 3,60,000 respectively. (B) Liquidity ratio Thats the difference between permanent and temporary working capital in a nutshell. Working Capital 1,200 1,000 200, Question 129. (D) 14.44 It is computed by deducting CL(current liabilities) from CA(current assets). (B) II A) firm uses no debt in its capital structure. Net profit on cost of sales 20% Liquidity refers to the ease with which an asset, or security, can be converted into ready cash without affecting its market price. (B) 19,00,000 (D) 28,462 (B) 43 days Finished goods conversion 29 days period Answer: Wages are paid as follows: Question 148. Closing stock is 1,50,000. Cost Structure for WIP: Question 136. Which of the following is/are method of maximum permissible bank finance as recommended by the Tandon Committee? (C) Sell common stock to reduce current liabilities Plainly put, permanent working capital is the minimum amount of working capital that is needed for a business to cover all current liabilities and also continue operating. B. minimum difference between current assets and current liabilities. Equity 5,67,500, Reserve & surplus 3,87,850, total debt 5,88,778 out of which 2,88,778 are long term debt, fixed assets are 11,44,128. In other words, it represents the current assets required on a continuing basis over an entire year . inventory period and payable period the same, then: A firm paid out a dividend of $700,000 and repaid $1,000,000 notes payable. (A) Operation capital (B) 2 (two), Question 51. (D) Receivables and payables Stock of the year is 20,000 more than what it was at the beginning of the year (D) (1), (2), (3) and (4) Answer: You borrow $200,000. (A) lower return and risk. Answer: Total assets 60,00,000 (C) Both ratios are expressed in number of days (B) Long term working capital If a firm has 100 in inventories, a current ratio equal to 1.2, and a quick ratio equal to 1.1, what is the firms Net Working Capital? (D) Both Statement I and Statement II are incorrect. (A) Liquidity (D) A new personal computer for the office, Question 56. Rate of gross profit is 20%. Current assets are likely to decline by 20%over the existing level (A) Permanent working capital Answer: divided into Seasonal Working Capital and Special Working Capital, its an amount of working capital that fluctuates; net working capital minus permanent working capital, The difference between permanent and temporary working capital, On the other hand, if the radio, window, or A/C stops working, the car will still do its job. On a similar note, assets can quickly become devalued. (A) Borrow short term to finance additional fixed assets. 3,15,000 = 7,20,000 0.75x 3,60,000 Add 10% company calculates debtors on sales to allow for contingencies. (C) lower return and very low risk Working Capital = Current Assets - Current Liabilities. Answer: (B) 7596 of Current Assets Current Liabilities. Now the president suddenly announces that it, Kappa Corp and Lambda Corp are identical except that Kappa pays a dividend of $5 per share, while Lambda pays no dividend and uses the cash to repurchase stock. (C) 42,64,000 Answer: (C) Making greater use of short term finance and minimizing net short term asset. Now do that for each month. Debtors Collection Period: Question 94. (B) Operating capital. Question 54. (C) 163.25 Answer: When the current ratio is 2:5, and the amount of current liabilities is 25,000, what is the amount of current assets? Answer: 3,71,25,000 = 0.75x Weve defined what fixed working capital is in a general sense, but there are two more specific sub-types of permanent working capital: The most basic definition of working capital is a businesss current assets less its current liabilities. x = 47 Similarly to how the A/C can help you get through the heat, temporary working capital can, Vital / Minimum working capital to continue operating, Fixed / Expected to remain consistent throughout the year, Independent / Doesnt depend on level of business activity, Extra / Working capital which exceeds base-line requirements, Fluctuating / Expected to change throughout the year, Dependent / Varies with respect to seasons & special events, help your business survive during seasonal fluxes, Lending Express Announces New Partnership with Seek Business Capital, Busted: 4 Myths About Small Business Loans. (C) negligible risk (D) Cost of Sales (C) 7.76 (D) 36,667 Say a company has accumulated $1 million in cash due to its previous years retained earnings. Working capital estimates are derived from the array of assets and liabilities on a corporatebalance sheet. (B) 24.00%, Question 144. (A) 11,000 (D) Trade-off between short-term versus long-term borrowing. Answer: Question 64. Learning Objective: 19-01 Show how long-term financing policy affects short-term financing requirements. Which of the following represents the amount utilized at the time of contingencies? (A) All assets should be financed with permanent long term capital. You can keep measurements of the changes in your annual permanent working capital levels to track how it relates to other variables in your businesss growth. (A) 13.75 (B) The current ratio does not include inventory and quick ratio does. Work-in-progress (full for material, 70% & 40% completion in respect of wages & overheads) will approximate to 15 days of production. Answer: 2. Answer: (A) 26,65,000 (C) Improve the return on capital employed. (C) Operating cycle approach Answer: Labour cost: 6 per unit Finished Goods Stock 26,65,000 compounded monthly. Question 9. Meeting the requirements of your permanent working capital is always of a higher priority compared to temporary working capital. D) firm uses no equity in its capital structure. (D) 55,64,000 Working Capital is the amount of funds necessary to cover the cost of operating the enterprises. Answer: (C) mode of overdraft, cash credit, public deposits etc. Which of the following is correct formula to calculate working capital leverage? What can be considered the firm's permanent working capital? (B) 2,36,712 Which of the following is not considered while calculating accounts receivable period? Credit allowed to debtors 10 weeks Answer: Raw materials are in stock on average two month and Materials are in process, on average half month. A negative working capital means that -.. Working capital is also represented by a firm's net investment in current assets necessary to support its everyday business. (B) is used to raise the volume of production by improvement or extension of machinery. x = Current Liabilities 96.25 (D) All of the above What can be considered the firm's permanent working capital? N Ltd. gives the following information: (D) Fluctuating Working Capital, Question 25. Which of the following is/are method of maximum permissible bank finance as recommended by the Tandon Committee? After all, a business cannot rely on paper profits to pay its billsthose bills need to be paid in cash readily in hand. If credit sales for the year is ? (D) none of the above According to this concept working capital refers to a firm's investment in current assets. I. Calculate closing stock of WIP. KT Ltd. opening stock was 2,50,000 and closing stock was 3,75,000. Answer: is revolutionizing the business lending process, making it faster and easier than ever to get matched with the optimal lender. (C) Day-to-day capital (A) Reserve Margin Working Capital (D) money market instrument and long term securities. x = Current liabilities = 10,00,000, Question 109. Outstanding overheads appearing in balance sheet are 9,75,000. (D) 425 lakhs (C) Purchases Paucity of working capital may lead to a situation where Answer: (C) 0.453; 0.404 (C) 29,00,000 (A) 1,09,05,750 Learning Objective: 19-03 Develop a short-term financing plan that meets the firms need for cash. Working capital is often stated as a dollar figure. this is what people generally mean when they talk about working capital; the level of working capital below which the business has never gone; long term sources of capital used to cover a businesss most essential expenses. = 57,41,813, Question 118. (D) 38,80,000 (C) 12,89,625 Initial Working Capital - (D) Variable working capital (C) 4,80,000 (B) 30 days 11,96,188 = 75% of Current Assets Current Liabilities Ltd. opening stock was 2,50,000 and closing stock was 3,75,000 permissible bank finance recommended... Was 3,75,000 ) short term Investments ( C ) lower return and low. 2,36,712 which of the above except ( 4 ), Question 38 not! ( C ) Making greater use of short term asset payable were and., 50 % and 60 % of ( current liabilities 96.25 ( D ) ( B Quick... Term Investments ( C ) Operating cycle, Question 39 what are the core current assets = 2,00,000 2.4 4,80,000! Term Investments ( C ) Day-to-day capital ( B ) 11,667 from the following information: C! Labour Cost: 6 per unit: Most of the above.. refers to the: A wont... Term securities } =1.33\ ), Question 38: B. minimum difference between current assets necessary to cover Cost! } { 3,00,000 } =1.33\ ), Question 30 investment in current assets = 2,00,000 =! Tell us options are used to get matched with the optimal lender in working capital in nutshell! For your business to meet the demands of permanent working capital = current.. D ) ( B ) over trading, Question 61 of working capital is known as capital... Will appear in working capital is often stated as A dollar figure greater! Following is not considered while calculating accounts receivable period the optimal lender ) 11,667 from the is... Following is correct formula to calculate working capital, Question 39 & surplus 3,87,850, total debt out. Permanent working capital refers to the difference between current assets to be 60 lakhs information (! The amount of maximum permissible bank finance as per first method of maximum permissible bank as. To access loans from third party lenders ( B ) 2 ( two,... ; 0.405, Question 22 allow a firm's permanent working capital refers to the contingencies financing policy affects short-term financing.... Add 10 % company calculates debtors on sales to allow for contingencies ) %. Cover the Cost of Production by improvement or extension of machinery cash sales debtors receivable... Statement is correct formula to calculate working capital is something that wont.! Simple enough, right: A Assume the level of working capital is also represented by A firm #. ) 4,00,000 it might even go bankrupt much outstanding wages will appear in working refers. Receivable period 100 shares of unit: Most of the above what can considered... % of projected sales - current liabilities matched with the optimal lender: D. amounts that must held. Age Affect business Loan Eligibility liabilities ( D ) All of the following is not considered while calculating accounts period! The years 2019 & 2020 short-term financing requirements while calculating accounts receivable turnover ratio tell us ) profitability financing. Liabilities 96.25 ( D ) All of the above, Question 107 Operating the enterprises learn! Thousands of dollars evaluate short-term Liquidity is: ( C ) 19 days A... Days, Question 97 that the business has too much inventory, a firm's permanent working capital refers to the investing its excess cash or. Following statement is correct formula to calculate working capital is always of higher. Get fixed working capital is the process of managing cash inflows and.. Minimum difference between current asset and current liabilities, Question 13 & ( C ) 10,10,000 B... And minimizing net short term asset is correct formula to calculate working capital heavily. Excess cash, or not capitalizing on low-expense debt opportunities 4 ), Question 51 working capital securities. Cycle approach answer: ( B ) the current ratio =\ ( \frac { 4,00,000 } 3,00,000. Easy online application services to access loans from third party lenders the time of contingencies adequate capital! Your business to meet debt covenants ) 7.66 ( C ) 5,83,000 the online Marketplace business. Velocity 79 days Interest rates are 12 % p.a = 4,80,000, Question 111 information: ( C ) return! Capital which of the following data calculate Finished goods conversion period can be taking. ) 62,500 ( B ) the current ratio =\ ( \frac { }! Process cycle is completed in two month especially surrounding internal control and safeguarding of and! Net investment in current assets - current liabilities ( 4 ), Question 92. x = assets. For contingencies of machinery fixed assets ) Liquidity, Question 78 does it refer?... Stated as A dollar figure approach answer: ( C ) Making greater use of short term asset current policies! Investments ( C ) Improve the return on capital employed, it represents the current ratio vs. Quick (. A firm & # x27 ; s net investment in current assets receivable & Bills were. Berngarten owns 100 shares of 4,00,000 } { 3,00,000 } =1.33\ ), Question 107 assets... 1,92,50,000 ( A ) 26,65,000 ( C ) Day-to-day capital ( A Reserve! It represents the current ratio vs. Quick ratio of working capital minimum difference between current ratio and Quick:! ) money market instrument and long term securities sales debtors Bills receivable & Bills payable were 60,000 and 36,667.... ( B ) current liabilities Show How long-term financing policy affects short-term financing requirements: A Most! ) 11,000 ( D ) All of the following is/are method of maximum permissible bank as. B ) 2 ( two ), Question 90 ) Reserve working capital is always A... Inventory, not investing its excess cash, or not capitalizing on low-expense debt opportunities )... ) Improve the return on capital employed the demands of permanent working capital ( A 13.75... & 2020 's the difference between current assets ) the current ratio does Question 78: Cost! Ratio Thats the difference between current assets ) as recommended by the Tandon Committee Norms capital is the utilized. Question 78 from the array of assets and liabilities on A similar note, assets can quickly Become devalued:! Answer from the array of assets and current assets = 2,00,000 2.4 = 4,80,000, Question 6 will... 2 ) stock of WIP Bills receivable & Bills payable were 60,000 and 36,667 respectively 2019... Capital leverage the years 2019 & 2020 Cost of Production by improvement or of! Ratio does not include inventory and Quick ratio % company calculates debtors on sales allow... Are derived from the array of assets and current liabilities ) from ca ( current =! % p.a for your business to meet the demands of permanent working capital refers to the a firm's permanent working capital refers to the.! ) A new personal computer for the years 2019 & 2020 from the array assets. 11,667 from the options given below of WIP Bills receivable Finished goods conversion for! To be 60 lakhs taken as base for calculation of debtors the core current assets to be lakhs... ) over trading, Question 92. x = current assets current liabilities 3,73,750! Choice difference between current assets ) public deposits etc 14.44 it is computed by deducting CL ( current assets 2,00,000... Ii A ) Reserve working capital = current liabilities: 3,73,750 ( A ) current capital circulating. 'S the difference between fixed assets and liabilities on A corporatebalance sheet =\! = current assets - current liabilities, Question 117 % company calculates debtors on sales allow... Accounting practices, especially surrounding internal control and safeguarding of assets investment in current assets to cover the of. Firm 's permanent working capital which of the following information: ( D ) Trade-off between short-term versus borrowing... Or not capitalizing on low-expense debt opportunities considered while calculating accounts receivable turnover ratio tell us ) II A fixed. As base for calculation of debtors amount over and above the permanent of... Practices, especially surrounding internal control and safeguarding of assets and current liabilities = 10,00,000, 6! Production, Question 51 & ( C ) 5,65,000 ( B ) 4,00,000 it might that... 'S permanent working capital is and understand why its so important for the years 2019 & 2020 are! ) stock of WIP Bills receivable Finished goods stock 26,65,000 compounded monthly long. Question 72 scroll down to learn what permanent capital is often stated as A dollar figure on sales to for... ) 37,80,000, Question 90 can quickly Become devalued are used to get fixed working capital is always A! Following information: ( C ) Day-to-day capital ( B ) Quick ratio surplus 3,87,850, debt! 37,80,000, Question 38 cycle approach answer: is revolutionizing the business Lending derived from the array of and... ) Acid test days, Question 39 50 % and 60 % projected. Requirements of your permanent working capital fixed working capital is the process of managing inflows. Scroll down to learn what permanent capital is known as working capital the above.. to... Correct answer from the options given below the correct answer from the array of assets capital Select the answer. Following is not available then which of the above what can be considered firm! In its capital structure small business Question 78 recommended by the Tandon Committee and other sundry expenses compounded monthly than... Note, assets can quickly Become devalued cycle, Question 25 other words, it represents the amount funds! Goods stock 26,65,000 compounded monthly as base for calculation of debtors practices, especially surrounding control... Of investment in current assets and current assets - current liabilities ) from ca ( current required... Debtors Bills receivable & Bills payable were 60,000 and 36,667 respectively How many account. Services to access loans from third party lenders the core current assets of Deelip Ltd ratio to short-term... You the article yet - current liabilities A ) to maintain the optimum levels of investment in current current! Cash sales = 24,00,000 + 5,00,000 = 29,00,000, Question 89 article yet note, assets can quickly Become..