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Home Questions 7S9QNB7HFQ
Target Exam

CUET

Subject

-- Accountancy Part B

Chapter

Accounting Ratios

Question:

Net Capital Employed is equal to :

(A) Fixed Assets + Current Assets - Long term liabilities
(B) Non current Assets + Current Assets - Current liabilities
(C) Fixed Assets + Current Assets - Equity
(D) Equity + Debt
(E) Current Assets - Current liabilities

Choose the correct answer from the options given below:

Options:

(A) and (B) only

(B) and (D) only

(B) (C) and (D) only

(A) and (D) only

Correct Answer:

(B) and (D) only

Explanation:

The correct answer is option 2- (B) and (D) only.

Capital Employed = Non-Current Assets + Working Capital (Current Assets– Current Liabilities)
Capital Employed = Shareholders’ Funds + Non-current liabilities

It is calculated to evaluate the total capital employed by the investors in any business for the realization of profits.

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