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    Question

    A company’s total current assets are ₹18 lakh, and

    its total current liabilities are ₹12 lakh. It is eligible for a working capital limit under the Tandon Committee 2nd Method. Calculate the Maximum Permissible Bank Finance (MPBF).
    A ₹1.5 lakh Correct Answer Incorrect Answer
    B ₹4.5 lakh Correct Answer Incorrect Answer
    C ₹7 lakh Correct Answer Incorrect Answer
    D ₹5 lakh Correct Answer Incorrect Answer
    E ₹8 lakh Correct Answer Incorrect Answer

    Solution

    Under 2nd method: MPBF = 75% of Current Assets – Other Current Liabilities = (75% of ₹18 lakh) – ₹12 lakh = ₹13.5 lakh – ₹12 lakh = ₹1.5 lakh

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