Statement I: Working capital leverage measures the responsiveness of return on equity for changes in current assets. Statement II: When the annual demand for an item is 3,200 units, unit cost Rs. 6, inventory carrying charges 25% per annum and cost of one procurement Rs. 150, the economic ordering quantity would be 700 units.

The correct answer is: Statement I is true, but Statement II is false.

Statement I is true. Working capital leverage measures the responsiveness of return on equity for changes in current assets. It is calculated by dividing the return on equity by the return on assets. A higher working capital leverage ratio indicates that a company is more sensitive to changes in current assets.

Statement II is false. The economic ordering quantity (EOQ) is the optimal quantity of an item to order in order to minimize the total costs of ordering and carrying inventory. It is calculated by using the following formula:

EOQ = √(2DC/IC)

where:

D = annual demand for the item
C = unit cost of the item
I = inventory carrying cost per unit per year

In this case, the annual demand for the item is 3,200 units, the unit cost is Rs. 6, the inventory carrying cost is 25% per annum, and the cost of one procurement is Rs. 150. Substituting these values into the formula, we get:

EOQ = √(2 * 3200 * 6 / 0.25) = 700 units

Therefore, the economic ordering quantity for this item is 700 units.