Calculate Current Ratio from the following information:
Inventories ₹50,000
Trade receivables ₹50,000
Advance tax ₹4,000
Cash and cash equivalents ₹30,000
Trade payables ₹1,00,000
Short-term borrowings (bank overdraft) ₹4,000
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → 1.29:1
Current ratio = current assets ÷ current liabilities. Advance tax is a current asset, and a bank overdraft is a short-term borrowing, so it is a current liability.
Current assets = Rs. 50,000 + Rs. 50,000 + Rs. 4,000 + Rs. 30,000 = Rs. 1,34,000
Current liabilities = Rs. 1,00,000 + Rs. 4,000 = Rs. 1,04,000
Current ratio = Rs. 1,34,000 ÷ Rs. 1,04,000 = 1.29 : 1
Note: This question is from NCERT (2026-27). NTA sets numerical questions from NCERT too, so do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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