Question : Items excluded from Current Assets while calculating the current ratio are 

Option 1: Loose Tools

Option 2: Stores and Spares

Option 3:  Provision for Doubtful Debts

Option 4:  All of the above 

Question : Assertion (A): Current Ratio is calculated by dividing liquid assets by current liabilities and current assets include loose tools, stores, and spares, and provision for doubtful debts.
Reason (R): The formula for the Current Ratio is Current Assets/Current Liabilities. Loose Tools, Stores and Spares, and Provision for Doubtful Debts are included in Current Assets.
 

Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A)

Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A)

Option 3: Assertion (A) is true but Reason (R) is False

Option 4: Both Assertions (A) and Reason (R) are False

Question : ---------------------ratio explains the relationship between current assets and current liabilities of a business.

Option 1: Liquid ratio

Option 2: Current ratio 

Option 3: Current assets ratio 

Option 4: Current liabilities ratio 

Question : ---------------------ratio explains the relationship between current assets and current liabilities of a business.

Option 1: Liquid ratio

Option 2: Current ratio 

Option 3: Current assets ratio 

Option 4: Current liabilities ratio 

Question : Working Capital Rs.6,30,000; Current Assets Rs.8,40,000 and Inventory Rs.3,00,000 (including Loose Tools Rs. 1,05,000). The current ratio will be

Option 1: 3.5:1

Option 2: 2.5:1

Option 3: 7:1

Option 4: None of the above