Question

companies to improve their position and to take right decision about management of various components ol working capital that can ultimately improve their liquidity position. Required: Following information has been extracted from the financial statements of ABC Company to analyze liquidity position of the Company based on current ratio. 1. If an industry bench mark of current ratio is 2:1, calculate current ratio of ABC Company from the following data and compare it with industry bench mark. Particulars Rs. Particulars Rs. Cash 400,000 Account payables 100,000 Fixed assets 1,500,000 Accruals 150,000 Inventory 150,000 Short term debt 250,000 Net Income 725,250 10-year Bonds 150,000 Account receivables 100,000 Marketable securities 200,000 Long term Debt 850,000 2. Calculate current ratio if company has decided to use Rs. 200,000 to pay off short term debt. Discuss whether company's decision to pay off sort term debt with cash is right to improve the liquidity position? Why or why not?​

Answer 1

Answer:

journal entry

Explanation:

bcom1st year