(a) What do you mean by financial statements? Describe the major types of financial statements. (b) Primal Transport Company has current assets of Rs. 2,000,000 and current liabilities of Rs.…

(a) What do you mean by financial statements? Describe the major types of financial statements. (b) Primal Transport Company has current assets of Rs. 2,000,000 and current liabilities of Rs. 1,000,000. What effect would the following transactions have on the firm's current ratio? a. Two new trucks are purchased for a total of Rs 800,000 in cash. b. The company borrows Rs 500,000 on short-term basis to carry an increase in receivables of the same amount. c. Additional common stock of Rs 1,000,000 is sold and the proceeds invested in the expansion of several terminals.