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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Current Liabilities of a company are ₹6,00,000. Its Current Ratio is 3:1 and Liquid Ratio is 1:1. Calculate the value of Inventory.
Current Ratio = Current Assets ÷ Current Liabilities = 3:1
Liquid (Acid Test) Ratio = Liquid Assets ÷ Current Liabilities = 1:1
Current Liabilities = ₹6,00,000
Current Assets = 3 × Current Liabilities = 3 × 6,00,000 = ₹18,00,000
Liquid Assets = 1 × Current Liabilities = 1 × 6,00,000 = ₹6,00,000
Inventory = Current Assets − Liquid Assets = 18,00,000 − 6,00,000 = ₹12,00,000
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.21 - 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.
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