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Question
Current Ratio 4; Liquid Ratio 2.5; Inventory ₹ 6,00,000. Calculate Current Liabilities, Current Assets and Liquid Assets.
Solution
`"Current Ratio" = "Current Assets"/ "Current liability" = 4/1`
`"Liquid Ratio" = "Liquid Assets "/"Current Liabilities" = 2.5/1`
Inventory = 6,00,000
Let Current Liabilities be = x
Current Assets = 4x
Quick Assets = 2.5x
Stock = Current Assets − Quick Assets
6,00,000 = 4x − 2.5x
x = 4,00,000
Current Assets = 4x = 4 × 4,00,000 = 16,00,000
Liquid Assets = 2.5x = 2. 5× 4,00,000 = 10,00,000
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