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Question
From the following compute Current Ratio:
| Particulars | ₹ |
| Total Assets | 40,00,000 |
| Non-Current Assets | 22,00,000 |
| Shareholder’s Funds: | |
| Share Capital | 24,00,000 |
| Reserve & Surplus | 3,00,000 |
| Non-Current Liabilities | 8,00,000 |
Numerical
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Solution
Current Ratio = `"Current Assets"/"Current Liabilities"`
Current Assets = Total Assets − Non-Current Assets
= ₹ 40,00,000 − ₹ 22,00,000
= ₹ 18,00,000
Current Liabilities = Total Assets (liabilities) − Share Capital − Reserves & Surplus − Non-Current Liabilities
= ₹ 40,00,000 − ₹ 24,00,000 − ₹ 3,00,000 − ₹ 8,00,000
= ₹ 5,00,000
Current Ratio = `(₹ 18,00,000)/(₹ 5,00,000)`
= 3.6 : 1
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