Question

Current ratio 1.5 :1, Working capital Rs. 30,000.What will be the current liabilities:

Answer 1

Answer:

see as under

Explanation:

CA/CL=1.5

CA=1.5CL

WORKING CAPITAL=CA-CL

30000=CA-CL

30000=1.5CL-CL

30000=0.5CL

30000/0.5=CL

60000=CL

CA=1.5*60000=90000

CL=60000

CA=90000

Answer 2

Answer:

Current Liabilities will be 60,000

Explanation:

Solution :

• Current ratio 1.5 :1
• Working capital Rs. 30,000
• Current Liabilities = ??

★ Current Ratio =

$\dfrac{Current \: Assets}{Current \: Liabilities} \: = \: \dfrac{1.5}{1}$

Let,

• Current Liabilities = x
• Current Assets = 1.5x

Working capital Rs. 30,000

• Working Capital = Current Assets - Current Liabilities

⇒ 30,000 = 1.5x - x

⇒ 30,000 = 0.5x

⇒ x = 30,000/0.5

⇒ x = 60,000

Current Liabilities = 60,000

• Current Assets = 1.5x

⇒ 1.5 × 60,000

⇒ 90,000

Current Assets = 90,000

★ Current Ratio =

$\dfrac{Current \: Assets}{Current \: Liabilities} \: = \: \dfrac{1.5}{1}$

$\dfrac{Current \: Assets}{Current \: Liabilities} \: = \: \dfrac{90,000}{60,000}$

Current Ratio = 1.5 : 1

Therefore, Current Liabilities will be 60,000