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WAEC Financial Accounting 1991 (August) Question 44

Question 44

Interpretation of Accounts

Accounting term used to describe the excess of current assets over current liabilities is

  1. A.share capital
  2. B.working capital
  3. C.subscribed capital
  4. D.reserve capital
  5. E.loan capital
Show the answer and explanation

Answer: B (working capital)

Explanation

Working capital = current assets − current liabilities.