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Question
From the following information, find out the current ratio:
| Total assets | ₹ 22,000 |
| Fixed assets | ₹ 10,000 |
| Capital employed | ₹ 20,000 |
Numerical
Solution
Current Ratio = `"Current Assets"/"Current Liabilities"`
Current Assets = Total Assets − Fixed Assets
= ₹ 22,000 − ₹ 10,000
= ₹ 12,000
Current Liabilities = Total Assets − Capital Employed
= ₹ 22,000 − ₹ 20,000
= ₹ 2,000
Current Ratio = `"Current Assets"/"Current Liabilities"`
= `(₹12,000)/(₹2,000)`
= `6/1`
= 6 : 1
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