Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting Ratios

Question:

The components of capital employed are:
A) Shareholders fund
B) Net fixed assets
C) Non current liabilities
D) Current assets
E) Fictitious assets

Choose the correct answer from the options given below-

Options:

A & B only

 B & D only

D & E only

A & C only

Correct Answer:

A & C only

Explanation:

Capital employed refers to the funds invested in a business for the long term, encompassing shareholders' equity, debentures, and long-term loans. Alternatively, it can be calculated as the sum of non-current assets and working capital (current assets - current liabilities).