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Calculate the total value of current assets

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Reference no: EM132951880

Question - Company ABC Ltd is in the business of manufacturing household personal care products, e.g., hair oil, toothpaste, etc.

-The promoters of this company had set up its manufacturing plant in Pune about 15 years ago by investing Rs3 crore, inclusive of land cost, from personal capacity.

-The company owns the land where the manufacturing plant was set up. The land was purchased at Rs 1 crore, although its current market price is around Rs 15 crore.

-The company's financial health is not very sound and its debt burden has been rising. As of today, the company has a bank loan of Rs10 crore, which it needs to pay off within 3 years from the current year. It has dues payable to suppliers worth Rs2 crore, which are to be paid within 6 months.

-The company has invested net retained earnings worth Rs5 crore in the business over the years. These were the only source of fundings for the company. Based on the details presented above, answer the following question. Answer the following question based on the information given above.

Total Current Assets

The company has unsold inventories worth 1.5 crore, which it expects to sell over the current year. It also has about 2 crore of money, which is yet to be collected from its customers, and which is expected to be collected within this quarter. The bank balance in its current bank account is just 50 lakh. There are no other current assets.

Based on these details, calculate the total value of current assets.

a. 8 crore

b. 2 crore

c. 6 crore

d. 4 crore

Reference no: EM132951880

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