Loading Tutorstips...
✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
From the following information, calculate the Quick Ratio:
| Particulars | Amount (₹) | Particulars | Amount (₹) |
|---|---|---|---|
| Total Debt | 12,00,000 | Long-term Provisions | 4,00,000 |
| Total Assets | 16,00,000 | Long-term Loans & Advances | 1,00,000 |
| Property, Plant and Equipment | 6,00,000 | Inventories | 1,90,000 |
| Non-Current Investments | 1,00,000 | Prepaid Expenses | 10,000 |
| Long-term Borrowings | 4,00,000 |
Quick Ratio = Quick Assets ÷ Current Liabilities = 6,00,000 ÷ 4,00,000 = 1.5:1
Working Notes:
Current Assets = Total Assets − (Property, Plant and Equipment + Non-Current Investments + Long-term Loans & Advances)
= 16,00,000 − (6,00,000 + 1,00,000 + 1,00,000) = ₹8,00,000
Quick Assets = Current Assets − (Inventories + Prepaid Expenses)
= 8,00,000 − (1,90,000 + 10,000) = ₹6,00,000
Current Liabilities = Total Debt − (Long-term Borrowings + Long-term Provisions)
= 12,00,000 − (4,00,000 + 4,00,000) = ₹4,00,000
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "T.S. Grewal Class 12 Vol 3 Chapter 4 Q.18 - Accounting Ratios", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 4 - Accounting Ratios.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
You can take our custom-built interactive practice quiz directly on this page to test your understanding of "T.S. Grewal Class 12 Vol 3 Chapter 4 Q.18 - Accounting Ratios" instantly.