Accountancy, asked by sakshimakhloga, 1 year ago

solve this please !!

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exceptionalmeno: please wait.

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Answered by exceptionalmeno

Here is the answer for current ratio and quick ratio.
please mark this as Brainliest answer.

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sakshimakhloga: how can i mark this as branlist answer

sakshimakhloga: as i am a new here i don't know how to do

exceptionalmeno: you can't actually to mark someone's answer as Brainliest... there has to be 2 answers given by other users.

exceptionalmeno: and no one has answered the question except me. so you can't mark my answer as Brainliest

Answered by RohitSaketi

1)Current ratio helps us in determining how well the company can pay its short Term debts..

Current ratio = (current assets) / (current liabilities)

=(total assets - fixed assets-non current investments -longterm advances) / (total debt-long term borrowings -longterm provisions)

=(800000-300000-50000-50000) /(600000-200000-200000)

=400000/200000=2/1=2:1

The ideal Current ratio for any company is 2:1 only..so the performance of the company is very good.

2) Quick ratio helps is in determining the ability of the company to meet its current debts "immediatelyyyyyy"

so we will deduct inventory and other items that take lot of time to be converted into money

Quick ratio= (quick assets) / (current liabilities}

=(current assets- prepaid expenses- inventory) / current liabilities

current assets and current liabilities are already calculated in the first part of the sum..400000 and 200000 respectively.

= (400000=5000-95000) / (200000)

=(300000/200000)= 3/2 = 1.5/1 =1.5 : 1

The ideal Quick ratio for any company is 1 : 1 only..so the company is performing very very very well.

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