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Q.9) Current Liabilities of a Company are Rs. 3,50,000. Its Current Ratio is 3:1 and Acid Test Ratio is 1.75 : 1. Calculate the value of Current Assets, LiquidAssets and Inventories. |
| Answer» CURRENT ASSETS = ₹10,50,000Liquid Assets = ₹6,12,500Inventories = ₹4,37,500Explanation:Current Liabilities = ₹3,50,000Let, Current Assets = X Current Ratio = 3:1Accordingly, Current Assets/Current Liabilities = 3/1Or, X/₹3,50,000 = 3/1Or, X = ₹10,50,000So, Current Asset = ₹10,50,000Let, INVENTORIES = YAcid Test Ratio = 1.75:1Accordingly, Current Assets - Inventories/Current Liabilities=1.75/1Or, ₹10,50,000 - Y/₹3,50,000 = 1.75/1Or, ₹10,50,000 - Y = ₹6,12,500Or, - Y = ₹6,12,500 - ₹10,50,000Or, - Y = - ₹4,37,500Or, Y = ₹4,37,500So, Inventories = ₹4,37,500Liquid Assets = Current Assets - Inventories = ₹10,50,000 - ₹4,37,500 = ₹6,12,500 | |