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question_answer1) Assertion [A] : While calculating the Current Ratio, Loose Tools and Stores & Spares are not included in the current asset. Reason [R]: Loose Tools and Stores & Spares are not held for sale or conversion into cash. Choose the Correct Option from the following:
question_answer2) Assertion [A] : If Current Ratio is 2 : 1. Current maturity of long-term debts i.e. Redemption of debentures in the current year, will increase the Current Ratio. Reason [R]: Current assets will decrease and there is no impact on current liabilities. Choose the Correct Option from the following:
question_answer3) Assertion [A] : If Current Ratio of a company is 1:1. Its Net working capital will be Zero. Reason [R]: When Net Working Capital is Zero, it will reduce the Current Ratio of the Company. Choose the Correct Option from the following:
question_answer4) Assertion [A] : Debt Equity Ratio of Vinod Ltd. is 2:1. If a Machinery is purchased by the company by issuing 2,00,000 Equity Shares to the Vendors of Machinery, Debt Equity will Decrease. Reason [R] : No Change in Debt but Equity is increased. Choose the Correct Option from the following:
question_answer5) Assertion [A] : Goods sold for Cash at cost price, will not increase the Gross Profit Ratio. Reason [R] : Revenue from operation will increase but closing inventory will decrease with the same amount. Choose the Correct Option from the following:
question_answer6) Assertion [A] : If a company has ideal Current Ratio and it further purchased goods on credit, the Current Ratio will decrease. Reason [R] : The Ideal Current Ratio of the company is 2:1. Choose the Correct Option from the following:
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