Following is the Balance Sheet of Title Machine Ltd. as at March 31,20

1.	Following is the Balance Sheet of Title Machine Ltd. as at March 31,2015.
Answer» Calculate Current Ratio and Liquid Ratio. Current ratio = \(\frac {\textit{Current assets}}{\textit{Current liabilities}} \) =\(\frac{24,00,000}{30,00,000}\) = 0.8 :1 Current Assets = Inventories + Trade Receivables + Cash + Short term Loans and Advances = 12,00,000+ 9,00,000+ 2,28,000+ 60,000 = Rs. 24,00,000 Current Liabilities = Trade Payables + Short-term Borrowing + Short-term Provisions = 23,40,000 + 6,00,000 = 60,000 = Rs.30,00,000 2. Quick Ratio Liquid ratio = \(\frac {\textit{Liquid assets}}{\textit{Current liabilities}} \) = \(\frac {\textit{12,00,00}}{\textit{30,00,000}} \)= 0.4:1 Quick Assets = Trade Receivables + Cash + Short term Loans and Advances, = 9,00,000 + 2,28,000 + 72,000 = Rs. 12,00,000

Following is the Balance Sheet of Title Machine Ltd. as at March 31,2015.

Answer»

Calculate Current Ratio and Liquid Ratio.

Current ratio = \(\frac {\textit{Current assets}}{\textit{Current liabilities}} \)

=\(\frac{24,00,000}{30,00,000}\) = 0.8 :1

Current Assets = Inventories + Trade Receivables + Cash + Short term Loans and Advances

= 12,00,000+ 9,00,000+ 2,28,000+ 60,000 = Rs. 24,00,000

Current Liabilities = Trade Payables + Short-term Borrowing + Short-term Provisions

= 23,40,000 + 6,00,000 = 60,000 = Rs.30,00,000

2. Quick Ratio

Liquid ratio = \(\frac {\textit{Liquid assets}}{\textit{Current liabilities}} \)

= \(\frac {\textit{12,00,00}}{\textit{30,00,000}} \)= 0.4:1

Quick Assets = Trade Receivables + Cash + Short term Loans and Advances,

= 9,00,000 + 2,28,000 + 72,000 = Rs. 12,00,000