The correct answer is C. Rs. 1,00,000.
The current ratio is a liquidity ratio that measures a company’s ability to pay its short-term obligations. It is calculated by dividing current assets by current liabilities. The liquid ratio is a stricter measure of liquidity than the current ratio. It is calculated by dividing current assets minus inventory by current liabilities.
Working capital is the difference between current assets and current liabilities. It is a measure of a company’s ability to meet its short-term obligations.
Fixed assets are assets that are not expected to be converted into cash within one year. They include land, buildings, and equipment.
Stock in trade is the value of the goods that a company has on hand for sale. It is included in current assets.
To calculate the stock in trade, we can use the following formula:
Stock in trade = Current assets – Current liabilities + Fixed assets
Given the following information:
Current ratio = 2.5
Liquid ratio = 1.5
Working capital = Rs. 1,20,000
Fixed assets = Rs. 3,00,000
We can calculate the stock in trade as follows:
Stock in trade = Current assets – Current liabilities + Fixed assets
= 2.5 * Current liabilities + Fixed assets
= 2.5 * Rs. 1,20,000 + Rs. 3,00,000
= Rs. 1,00,000
Therefore, the stock in trade is Rs. 1,00,000.
Option A is incorrect because it is the value of the current liabilities.
Option B is incorrect because it is the value of the current assets minus the value of the current liabilities.
Option D is incorrect because it is the value of the working capital.