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Home Questions HMFRTXZAGZ
Target Exam

CUET

Subject

Accountancy

Chapter

Accounting Ratios

Question:

Calculate current ratio from the following information-

PARTICULARS AMOUNT (₹)
Total assets 800000
Fixed assets 540000
Non-current investments 110000
Shareholder's funds 600000
Non-current liabilities 80000
Options:

2:1

1.25:1

1:2

3:4

Correct Answer:

1.25:1

Explanation:

Current ratio = Current asset/ current liabilities
                    = 150000/120000
                    = 1.25:1

Current liabilities =  Total assets - shareholders funds - non-current liabilities
                          = 800000 - 600000 -80000
                         = ₹120000
Current assets =  Total assets - Fixed assets - Non-current investments
                      = 800000 - 540000 - 110000
                      = ₹150000

* Total of asset side = Total of (equity + liabilities) side.

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