Multiple choice

If the total asset amount of a firm is Rs. 2,50,000 and net worth is Rs. 1,80,000, calculate creditor amount.

  1. Rs. 60,000

  2. Rs. 70,000

  3. Rs. 50,000.

  4. None of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

 As total assets are equal to capital plus creditors, we can deduct net worth or capital from total assets to calculate creditors.                       ||||| |---|---|---|---| |Creditors = Total Assets - Capital| | | | | 2,50,000 - 1,80,000 = 70,000| | | | | So, creditors are Rs. 70,000| | | | | | | | | Hence, creditors are Rs 70,000 . Net worth is capital.

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