calculate liquid ratio from the following information current liabilities 50000, current assets 80000,stock 25000, prepaid expenses 50000 debtors 30000
Answers
Calculate current ratio and quick ratio from the following information.
Stock Rs.1,00,000
Debtors Rs. 80,000
Bills receivables Rs. 20,000
Advance Tax Rs. 8,000
Cash Rs. 60,000
Creditors Rs.1,20,000
Bills payable Rs. 80,000
Bank overdraft Rs. 8,000
Answer
Current assets = Stock + Debtors +BR + Advance tax + Cash
= 100000 + 80000 + 20000 + 8000 + 60000
= 268000
Current Liabilities = Creditors + BP + Bank OD
= 120000 + 80000 + 8000
= 208000
Quick assets = Current assets - stock
= 268000 - 100000
= 168000
Current ratio = Current Assets / Current Liabilities
= 268000/208000
= 1.28
Quick ratio = Quick assets / Current Liabilities
= 168000/200000
= 0.84
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