Question

Quick Ratio 1.8; Current Assets Rs.80,000; Current Liabilities Rs.30,000. Calculate the value of Inventory

Answer 1

Answer:

Current assets - Current liabilities = 80,000 - 30,000 = 50, 000

Value of inventory = 50 ,000

Answer 2

ANSWER :

• ❖ If Quick Ratio is 1.8, Current Assets is Rs. 80,000 and Current Liabilities is Rs. 30,000; then the Value of Inventory is Rs. 26,000.

___________________________________________________________

SOLUTION :

❒ Given :-

• Quick Ratio = 1.8

• Current Assets = Rs. 80,000

• Current Liabilities = Rs. 30,000

❒ To Find :-

• Value of Inventory = ?

❒ Required Formulas :-

• $\dag \: \: \underline{ \boxed{ \sf{\: Quick \: \: Ratio = \dfrac{ Current \: \: Assets - Inventory}{Current \: \: Liabilities \: }}}}$

___________________________________________________________

❒ Calculation :-

It is given that,

• Quick Ratio = 1.8

• Current Assets = Rs. 80,000

• Current Liabilities = Rs. 30,000

Using the formula of Quick Ratio, we get,

• $\bigstar \: \: \tt{\: Quick \: \: Ratio = \dfrac{ Current \: \: Assets - Inventory}{Current \: \: Liabilities \: }}$

$\implies \: \tt{1.8 = \dfrac{Rs. \: 80,000 - Inventory}{Rs. \: 30,000}}$

$\implies \: \tt{Rs. \: 80,000 - Inventory = 1.8 \times Rs. \: 30,000}$

$\implies \: \tt{Rs. \: 80,000 - Inventory = Rs. \: 54,000}$

$\implies \: \tt{Inventory = Rs. \: 80,000 - Rs. \: 54,000}$

∴ Inventory = Rs. 26,000