Working Capital is Rs. 9,00,000; Trade payables Rs. 90,000; and Other Current Liabilities are Rs. 2,10,000. Circulate Current Ratio.

SOLUTION

Working Capital = Rs. 9,00,000
Current Liabilities = Trade Payables + Other Current Liabilities
= Rs. 90,000 + Rs. 2,10,000

= Rs. 3,00,000

Working Capital = Current Assets – Current Liabilities

9,00,000 = Current Assets –  Rs. 3,00,000
Current Assets = Rs. 9,00,000 + Rs. 3,00,000 = Rs. 12,00,000

Current ratio = Current assets / Current liabilities

= 12,00,000 / 3,00,000
= 4: 1


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