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Super Profit Method

Current Asset...

Question

Current Assets can be calculated by adding Working Capital and Current Liabilities.

A

True

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B

False

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Solution

The correct option is A True
Working Capital = Current Assets - Current Liabilities

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Similar questions

Q. Current Ratio is 2.5, Working Capital is ₹ 1,50,000. Calculate the amount of Current Assets and Current Liabilities.

Q. From the Balance Sheet given below, calculate:
(i) Fixed Assets
(ii) Current Assets
(iii) Current Liabilities
(iv) Working Capital

Balance Sheet as at 31^st March, 2018
Liabilities	₹	Assets	₹
Trade Creditors	42,000	Stock in Hand	48,000
Expenses Accrued	3,200	Debtors	36,000
Bank Overdraft	4,800	Prepaid Expenses	400
Long-Term Loan	20,000	Goodwill	20,000
Interest on Loan	1,000	Land	20,000
Capital	93,400	Plant	32,000
		Furniture	8,000
	1,64,400		1,64,400

Current Ratio is 3.5 : 1. Working Capital is Rs. 90,000. Calculate the amount of Current Assets and Current Liabilities.

Q. The assets net of current liabilities is working capital.

Q. Assertion :Management of working capital refers to the management of current assets and current liabilities. Reason: But the major thrust of course, is on the management of current assets ; because current liabilities arise in the context of current assets.

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