The __________ of a chemical company can be obtained directly from the balance sheet as the difference between current assets and current liabilities.
A. Cash ratio
B. Net working capital
C. Current ratio
D. Liquids assets
Answer: Option B
Solution (By Examveda Team)
The net working capital of a chemical company can be obtained directly from the balance sheet as the difference between current assets and current liabilities.Option A: Cash ratio. The cash ratio is a financial metric that compares a company's cash and cash equivalents to its current liabilities.
Option B: Net working capital. This is the correct answer as it represents the difference between current assets and current liabilities, indicating the liquidity available to a company.
Option C: Current ratio. The current ratio is another financial metric that compares a company's current assets to its current liabilities, providing an indication of the company's ability to cover its short-term liabilities with its short-term assets.
Option D: Liquid assets. While similar to net working capital, liquid assets typically refer to assets that can be easily converted into cash without significant loss of value, whereas net working capital specifically considers the difference between current assets and current liabilities.
Therefore, the correct answer is Option B: Net working capital.
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A. Initial cost
B. Book value at the end of (n - 1)th year
C. Depreciation during the (n - 1)th year
D. Difference between initial cost and salvage value
Which of the following is not a current asset of a chemical company?
A. Inventories
B. Marketable securities
C. Chemical equipments
D. None of these
In declining balance method of depreciation calculation, the
A. Value of the asset decreases linearly with time
B. Annual cost of depreciation is same every year
C. Annual depreciation is the fixed percentage of the property value at the beginning of the particular year
D. None of these
Generally, income taxes are based on the
A. Total income
B. Gross earning
C. Total product cost
D. Fixed cost

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