Financial Statements

Ratios

Medium

Net Capital Employed is equal to :

(A) Fixed Assets + Current Assets - Long term liabilities

(B) Non current Assets + Current Assets - Current liabilities

(C) Fixed Assets + Current Assets - Equity

(D) Equity + Debt

(E) Current Assets - Current liabilities

Choose the correct answer from the options given below :

(A) and (B) only

(B) and (D) only

(A) and (D) only

✅ Correct Option: 2

Capital Employed = Non-current Assets + Current Assets - Current Liabilities (B), which also equals Shareholders Funds + Long-term Debt, i.e., Equity + Debt (D). Both represent long-term funds invested in the business. Hence (B) and (D) only.

2022: 8 Aug Shift 2

Debt-equity ratio is a sub-part of:

2026: 12 May Shift 1

Simrit Ltd. has a current ratio of 3.5:1 and quick ratio of 2:1. If excess of current assets over quick assets as represented by inventories is Rs. 24,000, What will be the current assets in this case?

2026: 11 May Shift 2

The two basic measures of liquidity are:

2022: 8 Aug Shift 2

A low stock turnover ratio indicates:

2025: 22 May Shift 2

Match List-I with List-II:

List-I	List-II
(Ratio)	(Formula)
(A) Current ratio	(I) Market Price of a share/EPS
(B) Operating Margin Ratio	(II) Current Assets/Current Liabilities
(C) Return on Capital employed	(III) 100 - Operating Ratio
(D) Price earning ratio	(IV) Profit before interest and tax/Capital employed X 100

Choose the correct answer from the options given below:

2026: 23 May Shift 2

As per the information given below, what will be the amount of Gross Profit?

Average Inventory = Rs. 80,000

Inventory Turnover Ratio = 8 times

Selling Price = 20% above revenue from operations

Solution

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