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Home Questions S79CMDHRA7
Target Exam

CUET

Subject

Entrepreneurship

Chapter

Business Arithmetic

Question:

Match List I with List II

LIST I

LIST II

A. Cash conversion cycle      

I. Total Current Assets

B. Gross working capital

II. Current Assets

C. Stock

III. Current liabilities

D. Trade creditors

IV. Time required to turn purchase into cash receipts from customers

Choose the correct answer from the options given below:

Options:

A-IV, B-I, C-III, D-II

A-I, B-IV, C-II, D-III

A-IV, B-I, C-II, D-III

A-I, B-II, C-IV, D-III

Correct Answer:

A-IV, B-I, C-II, D-III

Explanation:

The correct answer is option (3) - A-IV, B-I, C-II, D-III

Here's why:

  • Cash conversion cycle (CCC): Measures the time it takes for a company to convert its investments in inventory and receivables back into cash from sales. (Matches IV)
  • Gross working capital (GWC): Total current assets. (Matches I)
  • Stock (Inventory): A component of current assets. (Matches II)
  • Trade creditors: Suppliers the company owes money to, a part of current liabilities. (Matches III)

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