Banking · Working Capital Assessment - Tandon Committee
Under the Maximum Permissible Bank Finance (MPBF) Method II, which was originally suggested by the Tandon Committee, what is the mandatory minimum contribution required from the borrower's long-term funds towards the working capital gap?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 120 percent of the total current assets of the firm.
- 225 percent of the total current assets of the firm.✓
- 325 percent of the working capital gap (Total Current Assets minus Current Liabilities other than bank borrowings).
- 415 percent of the projected annual turnover of the business.
Correct answer
25 percent of the total current assets of the firm.
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