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Question
Quick Ratio of Roxy Traders is 0.8 : 1. State with reasons whether the following transaction will increase, decrease or will have no change on the ratio.
Sale of Fixed Assets a 20% loss
Give Reasons
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Solution
Increase in Quick Ratio
Reason:
- Fixed asset (non–current) decreases.
- Quick assets (cash) increase by the sale proceeds.
- No change in current liabilities.
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2025-2026 (March) Board Sample Paper - Analysis of Financial Statements
