passwella.
Menu

JAMB Principles of Accounts 2006 Question 8

Question 8

Interpretation of Accounts

Capital ₦?
Profit and loss ₦3 500
Current assets ₦?
Current liabilities ₦2 000
Fixed assets ₦11 000
The company maintains a current ratio of 3:1.
Determine the current assets

  1. A.₦7 000
  2. B.₦6 000
  3. C.₦8 000
  4. D.₦9 000
Show the answer and explanation

Answer: B (₦6 000)

Explanation

Current ratio = current assets ÷ current liabilities = 3, so current assets = 3 × ₦2 000 = ₦6 000.