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Question
Quick Assets ₹ 1,50,000; Inventory (Stock) ₹ 40,000; Prepaid Expenses ₹ 10,000; Working Capital ₹ 1,20,000. Calculate Current Ratio.
Solution
Quick Assets = 1,50,000
Inventory = 40,000
Prepaid Expenses = 10,000
Current Assets = Quick Assets + Inventory + Prepaid Expenses
= 1,50,000 + 40,000 + 10,000 = 2,00,000
Working Capital = Current Assets − Current Liabilities
1,20,000 = 2,00,000 − Current Liabilities
Current Liabilities = 80,000
`"Current Ratio" = "Current Assets"/ "Current liability" = 200000/80000 = 2.5:1`
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|
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||
|
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||
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|
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