Calculate quick ratio: Total current liabilities Rs. 2,40,000; Total

1.	Calculate quick ratio: Total current liabilities Rs. 2,40,000; Total current assets Rs. 4,50,000; Inventories Rs. 70,000; Prepaid expenses Rs. 20,000
Answer» Quick ratio = (Current assets)/(Current liabilities) Quick ratio = Current assets - Inventory - Prepaid expenses = 4,50,000 - 70,000 - 20,000 = 3,60,000 Quick ratio = 3,60,000/2,40,000 = 1.5 : 1

Calculate quick ratio: Total current liabilities Rs. 2,40,000; Total current assets Rs. 4,50,000; Inventories Rs. 70,000; Prepaid expenses Rs. 20,000

Answer»

Quick ratio = (Current assets)/(Current liabilities)

Quick ratio = Current assets - Inventory - Prepaid expenses

= 4,50,000 - 70,000 - 20,000

= 3,60,000

Quick ratio = 3,60,000/2,40,000

= 1.5 : 1