Question

Which one of the following is a second method of Calculation of Maximum Permissible Bank finance recommded by Tandon Committee?

Q: Answer-Which one of the following is a second method of Calculation of Maximum Permissible Bank finance rec...

As per Tandon Committee, three methods were suggested for the calculation of Maximum Permissible Bank Finance for the working capital needs of a borrower. Second method is mostly used by the banks which is Current assets Other Current liabilities 25 CA Other Current Liabilities exclude short term borrowings from the bank existing

A (Current assets – Other Current liabilities) – 25% (CA – Other Current Liabilities)

B (Current assets – Other Current liabilities) – 25% (CA)

C (Current assets – Other Current liabilities) – 25% (CA – Other Current Liabilities- Existing Short term borrowings)

D (Current assets – Other Current liabilities) – 25% (Other Current Liabilities)

E None of the above

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Which one of the following is a second method of Calculation of Maximum Permissible Bank finance recommded by Tandon Committee?

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