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Question
Current Liabilities ₹ 20,000; Working Capital ₹ 80,000. Calculate Current Ratio.
Numerical
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Solution
Working Capital = Current Assets − Current Liabilities
₹ 80,000 = Current Assets − ₹ 20,000
Current Assets = ₹ 80,000 + ₹ 20,000
= ₹ 1,00,000
Current Ratio = `"Current Assets"/"Current Liabilities"`
Current Ratio = `(₹ 1,00,000)/(₹ 20,000)`
= 5 : 1
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