Question:
109. Current ratio is 4:1.Net Working Capital is Rs.30,000.Find the amount of current Assets.a) Rs.10,000b) Rs.40,000c) Rs.24,000d) Rs.6,000110. Current ratio is 2:5.Current liability is Rs.30000.The Net working capital isa) Rs.18,000b) Rs.45,000c) Rs.(-) 45,000d) Rs.(-)18000111. Quick assets do not includea) Govt.bondb) Book debtsc) Advance for supply of raw materialsd) Inventories.112. The ideal quick ratio isa) 2:1b) 1:1c) 5:1d) None of the above
Answer
109. Current Ratio = Current Asset/Current Liabilities
4:1 = Current Asset / Current Liabilities
Therefore, Current Assets = 4(Current Liabilities)
Net Working Capital = Current Asset – Current Liabilities
30000 = Current Asset – Current Liabilities
30000 = 4 (Current Liabilities) – Current Liabilities
