Advertisements
Advertisements
प्रश्न
A firm had Current Assets of ₹5,00,000. It paid Current Liabilities of ₹1,00,000 and the Current Ratio became 2:1. Determine Current Liabilities and Working Capital before and after the payment was made.
उत्तर
Firm disposed off liabilities of Rs 1,00,000 which results in decrease in current liabilities and current assets by the same amount.
After disposing liabilities:
Current Assets = Rs 4,00,000 (Rs 5,00,000 – Rs 1,00,000)
And, Let Current Liabilities be (x – Rs 1,00,000)
`"Current Ratio" = "Current Assets"/ "Current liability"= 400000/(x-100000) = 2/1`
4,00,000 = 2x – 2,00,000
6,00,000 = 2x
Therefore, x = 3,00,000
Current Liabilities after payment = x – Rs 1,00,000 = Rs 2,00,000
Working Capital after Payment = Current Assets – Current Liabilities
= Rs 4,00,000 – Rs 2,00,000 = Rs 2,00,000
Current Assets before payment = Rs 5,00,000
Current Liabilities before Payment = Rs 3,00,000
Therefore, Working Capital Before Payment = Current Assets – Current Liabilities
= Rs 5,00,000 – Rs 3,00,000 = Rs 2,00,000
APPEARS IN
संबंधित प्रश्न
Following is the Balance Sheet of Raj Oil Mills Limited as at March 31, 2017. Calculate Current Ratio.
| Particulars | (Rs) |
| I. Equity and Liabilities: | |
|
1. Shareholders’ funds |
|
|
a) Share capital |
7,90,000 |
|
b) Reserves and surplus |
35,000 |
|
2. Current Liabilities |
|
|
a) Trade Payables |
72,000 |
| Total | 8,97,000 |
| II. Assets | |
|
1. Non-current Assets |
|
|
a) Fixed assets |
|
|
Tangible assets |
7,53,000 |
|
2. Current Assets |
|
|
a) Inventories |
55,800 |
|
b) Trade Receivables |
28,800 |
|
c) Cash and cash equivalents |
59,400 |
| Total | 8,97,000 |
Calculate Current Ratio if:
Inventory is Rs 6,00,000; Liquid Assets Rs 24,00,000; Quick Ratio 2:1.
From the following, calculate (a) Debt Equity Ratio (b) Total Assets to Debt Ratio (c) Proprietary Ratio.
| Rs. | |
| Equity Share Capital | 75,000 |
| Preference Share Capital | 25,000 |
| General Reserve | 45,000 |
| Balance in the Statement of Profits and Loss | 30,000 |
| Debentures | 75,000 |
| Trade Payables | 40,000 |
| Outstanding Expenses | 10,000 |
From the following compute Current Ratio:
| ₹ | ₹ | |||
| Trade Receivable (Sundry Debtors) | 1,80,000 | Bills Payable | 20,000 | |
| Prepaid Expenses | 40,000 | Sundry Creditors | 1,00,000 | |
| Cash and Cash Equivalents | 50,000 | Debentures | 4,00,000 | |
| Marketable Securities | 50,000 | Inventories | 80,000 | |
| Land and Building | 5,00,000 | Expenses Payable | 80,000 |
State giving reasons, which of the following transactions would improve, reduce or not change the Current Ratio, if Current Ratio of a company is (i) 1:1; or (ii) 0.8:1:
(a) Cash paid to Trade Payables.
(b) Purchase of Stock-in-Trade on credit.
(c) Purchase of Stock-in-Trade for cash.
(d) Payment of Dividend payable.
(e) Bills Payable discharged.
(f) Bills Receivable endorsed to a Creditor.
(g) Bills Receivable endorsed to a Creditor dishonoured.
Current Assets of a company is are ₹ 5,00,000. Its Current Ratio is 2.5 : 1 and Quick Ratio is 1 : 1. Calculate value of Current Liabilities, Liquid Assets and Inventory.
When Debt to Equity Ratio is 2, state giving reason, whether this ratio will increase or decrease or will have no change in each of the following cases:
(i) Sale of Land (Book value ₹4,00,000) for ₹5,00,000; (ii) Issue of Equity Shares for the purchase of Plant and Machinery worth ₹10,00,000; (iii) Issue of Preference Shares for redemption of 13% Debentures, worth ₹10,00,000.
Total Debt ₹12,00,000; Current Liabilities ₹4,00,000; Capital Employed ₹`12,00,000. Calculate Total Assets to Debt Ratio.
From the following information, calculate Total Assets to Debt Ratio:
| ₹ | ₹ | |||
| Fixed Assets (Gross) | 6,00,000 | Accumulated Depreciation | 1,00,000 | |
| Non-current Investments | 10,000 | Long-term Loans and Advances | 40,000 | |
| Current Assets | 2,50,000 | Current Liabilities | 2,00,000 | |
| Long-term Borrowings | 3,00,000 | Long-term Provisions | 1,00,000 |
Cash Revenue from Operations (Cash Sales) ₹ 2,00,000, Cost of Revenue from Operations or Cost of Goods Solds ₹ 3,50,000; Gross Profit ₹ 1,50,000; Trade Receivables Turnover Ratio 3 Times. Calculate Opening and Closing Trade Receivables in each of the following alternative cases:
Case 1: If Closing Trade Receivables were ₹ 1,00,000 in excess of Opening Trade Receivalbes.
Case 2: If trade Receivables at the end were 3 times than in the beginning.
Case 3: If trade Receivables at the end were 3 times more than that of in the beginning.
From the following information, calculate Working Capital Turnover Ratio:
| ₹ | |
| Cost of Revenue from Operations (Cost of Goods Sold) | 10,00,000 |
| Current Assets | 5,00,000 |
| Current Liabilities | 3,00,000 |
Revenue from Operations ₹ 9,00,000; Gross Profit 25% on Cost; Operating Expenses ₹ 45,000. Calculate Operating Profit Ratio.
From the information given below, calculate any three of the following ratio:
(ii) Working Capital Turnover Ratio:
(iii) Debt to Equity Ratio; and
(iv) Proprietary Ratio.
| ₹ | ₹ | |||
| Revenue from Operations (Net Sales) | 5,00,000 | Current Liabilities | 1,40,000 | |
| Cost of Revenue from Operations (Cost of Goods Sold) | 3,00,000 | Paid-up Share Capital | 2,50,000 | |
| Current Assets | 2,00,000 | 13% Debentures | 1,00,000 |
The most precise test of liquidity is:
Collection of debtors:
Which one of the following is correct?
- A ratio is an arithmetical relationship of one number to another number.
- Liquid ratio is also known as acid test ratio.
- Ideally accepted current ratio is 1: 1.
- Debt equity ratio is the relationship between outsider’s funds and shareholders’ funds.
Consider the following statements.
Statement 1 - "Profit and loss account shows the operating performance of an enterprise for a period of time".
Statement 2 - "The Profit and loss account describes the different business activities such as revenues and expenses".
Amount from current assets is realised within ______.
Tangible Assets of the firm are ₹ 14,00,000 and outside liabilities are ₹ 4,00,000. Profit of the firm is ₹ 1,50,000 and the normal rate of return is 10%. The amount of capital employed will be:
