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If working capital is current assets minus current liabilities, then 28 Nov 2020, 14:38
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25% (medium)

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77% (01:38) correct 23% (01:43) wrong based on 340 sessions

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If working capital is current assets minus current liabilities, then on January 1, 1985, Company C’s current liabilities were what percent of its working capital?

A. 20%
B. 25%
C. 40%
D. 60%
E. 80%

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B
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If working capital is current assets minus current liabilities, then 29 Nov 2020, 00:45
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basshead
If working capital is current assets minus current liabilities, then on January 1, 1985, Company C ’s current liabilities were what percent of its working capital?

A. 20%

B. 25%

C. 40%

D. 60%

E. 80%
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Let current assets be 100 then current liabilities is 20 hence working capital is 80
Hence current liabilities as a percentage of working capital is \(\frac{20}{80}*100 = 25 \%\)

Ans-B.

Hope it's clear.
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If working capital is current assets minus current liabilities, then 29 Nov 2020, 13:23
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basshead
If working capital is current assets minus current liabilities, then on January 1, 1985, Company C ’s current liabilities were what percent of its working capital?

A. 20%

B. 25%

C. 40%

D. 60%

E. 80%
Show more

Capital = Assets - Liabilties.

From the graph, we have Liabilities/Assets = 20%. The question is asking for Liabilities/Capital, which means we need to eliminate Assets. Thus write this equation as Assets = 5*Liabilities and plugin above.

\(Capital = 5 * L - L = 4*L\)

\(\frac{L}{Capital} = \frac{1}{4}\)

Ans: B
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If working capital is current assets minus current liabilities, then 30 Nov 2020, 08:46
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basshead
If working capital is current assets minus current liabilities, then on January 1, 1985, Company C ’s current liabilities were what percent of its working capital?

A. 20%

B. 25%

C. 40%

D. 60%

E. 80%
Show more

Let CA (Current Asset) for Company C in Jan 1,1985 be 100
So, CL (Current Liability) will be 20

WC = CA - CL

Thus, Working Capital (WC) will be 80

Quote:
Company C ’s current liabilities were what percent of its working capital?
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\(= \frac{20}{80}*100\)

\(= 25\)%, Answer must be (B)
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If working capital is current assets minus current liabilities, then 30 Nov 2020, 09:28
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Find: \(CL/WC\)
Given: \(WC=CA-CL\) and \(CL=0.2CA\)

\(CL/WC = CL/ (CA - CL)\)
\( 0.2CA/ (CA - 0.2CA) \)
\( 0.2CA/0.8CA = 0.25CA = 25{%}\)
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If working capital is current assets minus current liabilities, then 21 May 2024, 07:04
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­Just be careful:

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If working capital is current assets minus current liabilities, then 29 May 2025, 18:14
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