Current Ratio 4; Liquid Ratio 2.5; Inventory Rs. 6,00,000. Calculate Current Liabilities, Current Assets and Liquid Assets.

SOLUTION

Current ratio = Current assets / Current liabilities
=4 / 1

Liquid ratio = Liquid assets / Current liabilities
= 2.5 / 1

Inventory = 6,00,000
Let Current Liabilities be = x
Current Assets = 4x
Quick Assets = 2.5x

Stock= Current Assets − Quick Assets
6,00,000 = 4x − 2.5x
x = 4,00,000

Current Assets = 4
= 4 × 4,00,000 
= 16,00,000

Liquid Assets = 2.5
= 2. 5 × 4,00,000 
= 10,00,000


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