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Byju's Answer
Standard XII
Accountancy
Acid Test Ratio
Liquidity rat...
Question

Liquidity ratio is also known as :-
a. Quick ratio
b. Acid test ratio
c. Working capital ratio
d. Stock turnover ratio

A
A and B
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B
A and C
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C
B and C
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D
C and D
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Solution

The correct option is A A and B
A liquidity ratio is an indicator of whether a company's current assets will be sufficient to meet the company's obligations when they become due. The liquidity ratios include the current ratio and the acid test or quick ratio. The current ratio and quick ratio are also referred to as solvency ratios.

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Q.

The following Balance Sheet and other information, calculate following ratios:

(i) Debt Equity Ratio (ii) Working Capital Turnover Ratio (iii) Debtors Turnover Ratio

Liabilities

Amount

Rs

Assets

Amount

Rs

General Reserve

80,000

Preliminary Expenses

20,000

Profit and Loss

1,20,000

Cash

1,00,000

Loan @15%

2,40,000

Stock

80,000

Bills Payable

20,000

Bills Receivables

40,000

Creditors

80,000

Debtors

1,40,000

Share Capital

2,00,000

Fixed Assets

3,60,000

7,40,000

7,40,000

Q.

The following Balance Sheet and other information, calculate following ratios:

(i) Debt-Equity Ratio (ii) Working Capital Turnover Ratio (iii) Trade Receivables Turnover Ratio

Balance Sheet as at March 31, 2017
Particulars Note No. Rs.
I. Equity and Liabilities:
1. Shareholders’ funds
a) Share capital
 10,00,000
b) Reserves and surplus
 9,00,000
2. Non-current Liabilities
a) Long-term borrowings
 12,00,000
3. Current Liabilities
a) Trade payables
 5,00,000
Total 36,00,000
II. Assets
1. Non-current Assets
a) Fixed assets
Tangible assets
 18,00,000
2. Current Assets
a) Inventories
 4,00,000
b) Trade Receivables
 9,00,000
c) Cash and cash equivalents
 5,00,000
Total 36,00,000

Additional Information: Revenue from Operations Rs. 18,00,000 Calculate:

i) Debt-Equity Ratio

ii) Working Capital Turnover Ratio

iii) Trade Receivables Turnover Ratio

(Debt-Equity Ratio 0.63:1; Working Capital Turnover Ratio 1.39 times; Trade Receivables Turnover Ratio 2 times)

Q.

From the following Balance Sheet and other information, calculate following ratios:

(i) Debt-Equity Ratio (ii) Working Capital Turnover Ratio (iii) Trade Receivables Turnover Ratio

Balance Sheet as at March 31, 2017
Particulars Note No. Rs.
I. Equity and Liabilities:
1. Shareholders’ funds
a) Share capital
 10,00,000
b) Reserves and surplus
 9,00,000
2. Non-current Liabilities
Long-term borrowings
 12,00,000
3. Current Liabilities
Trade payables
 5,00,000
Total 36,00,000
II. Assets
1. Non-current Assets
a) Fixed assets
Tangible assets
 18,00,000
2. Current Assets
a) Inventories
 4,00,000
b) Trade Receivables
 9,00,000
c) Cash and cash equivalents
 5,00,000
Total 36,00,000

Additional Information: Revenue from Operations Rs. 18,00,000

Q. Working capital turnover ratio is a/an ratio.
Q.

The accounts payable turnover ratio, also known as ___ turnover ratio.


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