Question

Trade Payables ₹ 50,000, Working Capital ₹ 9,00,000, Current Liabilities ₹ 3,00,000. Calculate Current Ratio.

Answer 1

$\begin{array}{l}\mathrm{Working}\mathrm{}\mathrm{Capital}=\mathrm{Current}\mathrm{}\mathrm{Assets}-\mathrm{Current}\mathrm{}\mathrm{Liabilities}\\ \text{9,00,000}=\text{Current Assets}-\text{3,00,000}\\ \text{Current Assets}=9,00,000+3,00,000=\text{Rs 12,00,000}\\ \mathrm{Current}\mathrm{}\mathrm{Ratio}=\frac{\mathrm{Current}\mathrm{}\mathrm{Assets}}{\mathrm{Current}\mathrm{}\mathrm{Liabilities}}\\ \text{=}\frac{12,00,000}{3,00,000}=4:1\end{array}$