# Question 01 Chapter 4 of +2-B – USHA Publication 12 Class

Q-1- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 01 Chapter 4 of +2-B

I. Liquidity Ratios

1. (Current Ratio) From the following calculate the current ratio.

 Balance Sheet of XYZ Company LTD. As of 31st March 2018 Particular ₹ I. Equity and Liabilities Shareholders’ Funds Share Capital 21,000 Reserve and Surplus surplus in Statement of Profit and Loss 2,500 Reserves 1,500 Current Liabilities Short-term Borrowings : Bank Overdraft 2,000 Trade Payable 6,000 33,000 II. Assets Non-Current Assets Tangible Assets Fixed Assets (Net) 17,000 Current Assets Inventories 6,200 Trade Receivable 3,200 Input CGST 1,500 Input SGST 1,500 Cash 3,600 33,000

## The solution of Question 01 Chapter 4 of +2-B: –

 Current Assets = Inventories + Trade Receivable + Input CGST + Input SGST + Cash = ₹ 6,200 + ₹ 3,200 + ₹ 1,500 + ₹ 1,500 + ₹ 3,600 = ₹ 16,000

 Current Liabilities = Bank Overdraft + Trade Payable = ₹ 2,000 + ₹6,000 = ₹ 8,000

 Current Ratio= Current Assets Current Liabilities

 Current Ratio= 16,000 8,000

Current Ratio=2:1

What are Liquidity Ratios – Formulas and Examples