Question
If the company earned revenue from operations of Rs.18
lakh, what is the working capital turnover ratio of the company? Direction (14 -17):- Study the Balance Sheet below to answer the questions below:Solution
Working capital turnover ratio = net revenue/working capital Working capital = current assets – current liabilities = 18,00,000 – 5,00,000 = 13,00,000 Thus, Working capital turnover ratio =18,00,000/ 13,00,000 = 1.38 times
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