Question

From the following information, calculate Liquid Ratio:

Particulars			₹	Particulars	₹​
Current Assets			2,00,000	Trade Receivables	1,10,000
Inventories			50,000	Current Liabilities	70,000
Prepaid Expenses			10,000

Answer 1

Quick Assets or Liquid Assets = Currents Assets – Inventories – Pre-paid Expenses
= Rs 2,00,000 – Rs 50,000 – Rs 10,000 = Rs 1,40,000
Current Liabilities = Rs 70,000