On the basis of the above case, current

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Target Exam

CUET

Subject

-- Accountancy Part B

Chapter

Accounting Ratios

Question:

On the basis of following information, answer the questions:

Particulars	Amount (₹)
Inventory	1,00,000
Total current assets	1,60,000
Shareholders funds	4,00,000
13% debentures	3,00,000
Current liabilities	1,00,000
Net profit before tax	3,51,000
Cost of revenue from operations	5,00,000

On the basis of the above case, current ratio is:

Options:

2:1

2:3

1:2

1.6:1

Correct Answer:

1.6:1

Explanation:

The correct answer is option 4- 1.6:1.

Current ratio = Current assets/ Current liabilities
= 1,60,000/1,00,000
= 1.6:1