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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 and Surplus 3,00,000 - Accounts

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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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Chapter 14: Ratio Analysis - PRACTICAL QUESTIONS [Page 14.114]

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D. K. Goel Accountancy Volume 1 and 2 [English] Class 12 ISC
Chapter 14 Ratio Analysis
PRACTICAL QUESTIONS | Q 3. | Page 14.114
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