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From the following particulars, calculate current ratio, and liquid ratio.Cash Rs – 18,000; Bills payable – 27,000; Bank O/D – 5,000; Debtors Rs – 1,42,000; creditors – 1,20,000; Stock Rs – 1,80,000; outstanding expenses – 15,000. |
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Answer» (a) Current Ratio = (current Assets)/(Current Liabilities) Current Assets = Cash + Debtor + Stock = 18,000 + 1,42,000 + 1,80,000 = Rs. 3,40,000 Current liabilities = Bills payable + Creditors + Outstanding expenses = 27,000 + 1,20,000 + 15,000 + 5,000 = Rs. 1,67,000 (b) Liquid ratio = (Liquid Assets)/(Current Liabilities) Liquid Assets = Current Assets – Closing stock = 3,00,000 – 1,80,000 = Rs. 1,60,000 ∴ Liquid ratio = 160000/167000 = 96 : 1 |
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