Question

Ramu Ltd. has a current ratio of 3 1. If its inventory is Rs. 30,000 and total current liabilities are Rs. 60,000, find out its Quick Ratio.

Answer 1

Answer:

2.5:1

Explanation:

CURRENT ASSETS= 60000*3= 180000

QUICK ASSETS= 180000-30000=150000

QUICK RATIO= 150000/60000= 2.5/1

Answer 2

Answer:

Quick Ratio is 2.5 : 1

Explanation:

Current Ratio = Current Asset / Current Liabilities = 3 : 1

Total Current Liabilities are Rs. 60,000

Current Asset = 60,000 × 3.

Current Asset = 1,80,000

Quick Ratio = ??

Quick Ratio :

Quick Ratio = Quick Asset / Current Liabilities

Current Liabilities are Rs. 60,000

inventory is Rs. 30,000

Quick Asset = Current Asset - Inventory

⇒ 1,80,000 - 30,000

⇒ 1,50,000

Quick Asset = 1,50,000

Quick Ratio = Quick Asset / Current Liabilities

⇒ 1,50,000 / 60,000

⇒ 2.5 / 1

Quick Ratio = 2.5 : 1

Therefore,

Quick Ratio is 2.5 : 1