Current assets are Rs.4,00,000
Inventories are Rs.2,00,000
Working capital is Rs.2,40,000
Calculate Current Ratio.

Correct option is B

Current assets = ₹4,00,000, Inventories = ₹2,00,000, Working capital = ₹2,40,000. Calculate the Current Ratio.
Since Working Capital = Current Assets – Current Liabilities:

$$\text{Working Capital} = \text{Current Assets} - \text{Current Liabilities} \\2,40,000 = 4,00,000 - \text{Current Liabilities} \\\text{Current Liabilities} = 4,00,000 - 2,40,000 = 1,60,000\text{Current Ratio} = \frac{\text{Current Assets}}{\text{Current Liabilities}} \\\frac{4,00,000}{1,60,000} = 2.5 : 1$$​​​

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