Calculate Current Ratio if Stock is Rs. 6,00,000; Liquid Assets Rs. 24,00,000; Quick Ratio 2 : 1.

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Solution

Quick Ratio = 2 : 1

Let Current Liabilities = x

Then Quick Assets = 2x

Or, 24,00,000 = 2x

x = $\frac{24, 00, 000}{2}$ = 12,00,000 = Current Liabilities

Current Assets = Quick Assets + Stock

= Rs. 24,00,000 + Rs. 6,00,000

= Rs. 30,00,000

Current Ratio
= $\frac{C u r r e n t A s s e t s}{C u r r e n t L i a b i l i t i e s}$
= $\frac{30, 00, 000}{12, 00, 000}$
= 2.5 : 1

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