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    Question

    A company's working capital (WC) is ₹20 lakhs, and its

    annual sales are ₹120 lakhs. What is the Working Capital Turnover Ratio?
    A 5 times Correct Answer Incorrect Answer
    B 4 times Correct Answer Incorrect Answer
    C 8 times Correct Answer Incorrect Answer
    D 6 times Correct Answer Incorrect Answer
    E 3 times Correct Answer Incorrect Answer

    Solution

    The Working Capital Turnover Ratio is calculated by dividing the annual sales by the working capital. In this case, ₹ 120 lakhs / ₹ 20 lakhs = 6 times. This ratio indicates how efficiently the company is using its working capital to generate sales.

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