On the basis of following data the Working Capital Turnover Ratio of a company will be Liquid Assets...........

General Accounting Principles Ratio analysis

On the basis of following data, the Working Capital Turnover Ratio of a company will be :

Liquid Assets Rs 3,70,000; Inventory Rs 80,000; Current Liabilities Rs 1,50,000; Cost of Revenue from operations Rs 7,50,000.

2.5 Times

3 Times

5 times

3.8 times

GIVEN: Liquid Assets Rs 3,70,000; Inventory Rs 80,000; Current Liabilities Rs 1,50,000; Cost of revenue from operations Rs 7,50,000.

current assets= liquid assets + inventory

=Rs 3,70,000 + Rs 80,000

=Rs. 4,50,000

Working capital = current assets - current liabilities

= Rs. 4,50,000 - Rs. 1,50,000

= Rs. 3,00,000

working capital turnover ratio = cost of revenue from operations/ working capital

= Rs. 7,50,000/ Rs. 3,00,000

= 2.5 times

By: Subhash Singh

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