Practice - Working Capital Turnover Ratio
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Practice Questions
Test your understanding with targeted questions
What is the formula for calculating the Working Capital Turnover Ratio?
💡 Hint: Recall the formula we discussed during the sessions.
Define current assets.
💡 Hint: Think of examples like cash and inventory.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What does a high Working Capital Turnover Ratio indicate?
💡 Hint: Think about what the ratio measures.
True or False: A low Working Capital Turnover Ratio always indicates poor financial health.
💡 Hint: Reflect on industry comparisons we discussed.
2 more questions available
Challenge Problems
Push your limits with advanced challenges
A company has net sales of ₹1,500,000 and current assets of ₹750,000 with current liabilities of ₹250,000. Calculate the Working Capital Turnover Ratio and analyze the significance of the result.
💡 Hint: Break down the ratios step-by-step for clarity.
Company X has a very high Working Capital Turnover Ratio of 12 while company Y stands at 2. Discuss the potential risks and rewards of such ratios in terms of liquidity and operational strategy.
💡 Hint: Contrast between high efficiency and the risks of not maintaining adequate reserves.
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