Accounting - Study Mode

[#2361] Accounts receivable & inventory are the examples of
Correct Answer

(A) Current assets

Explanation

Solution: Accounts receivable & inventory are the examples of Current assets. Current assets include cash, cash equivalents, accounts receivable, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets. Current assets are important to businesses because they can be used to fund day-to-day business operations and to pay for the ongoing operating expenses.

[#2362] Which of the following account will be credited in the books of XYZ Co. Ltd, if the business purchases a vehicle thriugh cheque?
Correct Answer

(C) Bank account

Explanation

Solution: Bank account will be credited in the books of XYZ Co. Ltd, if the business purchases a vehicle thriugh cheque.

[#2363] In which of the following condition, a company will have positive working capital?
Correct Answer

(A) If current assets>current liabilities

Explanation

Solution: If current assets>current liabilities, a company will have positive working capital. When a company has more current assets than current liabilities, it has positive working capital.

[#2364] Liquidity ratio does not include-
Correct Answer

(D) Stock

[#2365] If the rate of gross profit is 25% of the sales and the cost of goods sold is Rs. 1,00,000 the amount of gross profit will be:
Correct Answer

(D) Rs. 33,333