Current ratio =2:5,current liabilities =30000,find net working capital

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1. Current ratio = 2 : 5 , Current liabilities = 30,000. Find net working capital.

   Answer: (-) 18,000

   [tex] \tt{Current \: \: Ratio = \frac{Current \: \: Assets}{Current \: \: Liabilities}} [/tex]

   » 2 : 5 = Current Assets / 30,000

   » 2/5 = Current Assets / 30,000

   » 2/5 × 30,000 = Current Assets

   » Current assets = 12,000

   Now, we know that:

   Working Capital = Current Assets – Current Liabilities

   = 12,000 – 30,000

   = (-) 18,000

   Thus, the net working capital is (-) 18,000.

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