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Following is the Balance Sheet of Raj Oil Mills Limited as at March 31, 2017. Calculate Current Ratio. - Accountancy

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ConceptTypes of Ratios

Question

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

Solution

`"Current Ratio" = "Current Assets"/"Current Liablities"`

                          = `"1,44,000"/"72,0000"`

                          =`2 : 1`

Current Assets = Inventories +Trade Receivables + Cash

                       = 55,800 + 28,800 + 59,400

                       = Rs 1,44,000

Current Liabilities = Trade Payables = Rs 72,000

  Is there an error in this question or solution?
Solution Following is the Balance Sheet of Raj Oil Mills Limited as at March 31, 2017. Calculate Current Ratio. Concept: Types of Ratios.
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