Current Assets of a company is are Rs. 5,00,000. Its Current Ratio is 2.5 : 1 and Quick Ratio is 1: 1. Calculate value of Current Liabilities, Liquid Assets and Inventory.

Post category:Accountancy
Reading time:1 mins read

SOLUTION

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

Current Assets = 5,00,000
Current ratio = Current assets / Current liabilities
= 5,00,000 / 2,00,000

Liquid Assets = Current Liabilities × 1
= 2,00,000

Inventory = Current Assets − Quick Assets
= 5,00,000 − 2,00,000
= 3,00,000

Please Share This Share this content

You Might Also Like

Name the account which is opened to credit the share of profit of the deceased partner, till the time of his death to his Capital Account. (Delhi 2013)

Total Debt Rs. 12,00,000; Shareholders’ Funds Rs. 2,00,000; Reserves and Surplus Rs. 50,000; Current Assets Rs. 5,00,000; Working Capital Rs. 1,00,000. Calculate Total Assets to Debt Ratio.

Leave a Reply Cancel reply

Share this content