# Question 1 Chapter 4 of +2-B – T.S. Grewal 12 Class

Question 1 Chapter 4 of +2-B

Current Ratio and Quick Ratio

1. From the following, compute Current Ratio:

 Amount Amount Trade Receivables (Sundry Debtors) 1,80,000 Bills Payable 20,000 Prepaid Expenses 40,000 Sundry Creditors 1,00,000 Cash and Cash Equivalents 50,000 Debentures 4,00,000 Marketable Securities 50,000 Inventories 80,000 Land and Building 5,00,000 Expenses Payable 80,000

Hint: Marketable Securities means the Short-term Investment.

### The solution of Question 1 Chapter 4 of +2-B: –

 Current Assets= Trade Receivables + Pre-paid Expenses + Cash and Cash Equivalents + Marketable Securities + Inventories

 = Rs. 1,80,000 + Rs. 40,000 + Rs. 50,000 + Rs. 50,000 + Rs. 80,000

 Current Assets= Rs. 4,00,000

 Current Liabilities= Bills Payable + Sundry Creditors + Expenses Payable

 Current Liabilities= Rs. 20,000 + Rs.1,00,000 + Rs.80,000

 Current Liabilities= Rs. 2,00,000

 Current Ratio= Current Assets Current Liabilities

 Current Ratio= 4,00,000 2,00,000

Current Ratio=2:1

Balance Sheet: Meaning, Format & Examples

Comment if you have any question.

Also, Check out the solved question of previous Chapters: –

### T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
• Chapter No. 3 – Goodwill: Nature and Valuation
• Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 – Admission of a Partner
• Chapter No. 6 – Retirement/Death of a Partner
• Chapter No. 7 – Dissolution of a Partnership Firm

### T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 – Financial Statements of a Company
• Chapter No. 2 – Financial Statement Analysis
• Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
• Chapter No. 4 – Accounting Ratios
• Chapter No. 5 – Cash Flow Statement

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