# Question 20 Chapter 4 of +2-B – USHA Publication 12 Class

Q-20- CH-4 Book 2 - Usha Pub. +2 Book 2020 - Solution

Question 20 Chapter 4 of +2-B

I. Liquidity Ratios

20. A firm had current assets of ₹ 2,00,000. It then paid a current liability of ₹ 50,000. After this payment the current ratio was 2 : 1. Determine the size of current liabilities and working capital after and before the payment was made.

## The solution of Question 20 Chapter 4 of +2-B: –

 Current Assets before payment = ₹ 2,00,000 Current Liabilities paid = ₹ 50,000 Current Assets after payment of Current Liabilities = ₹ 1,50,000 Current Ratio after payment current liabilities = 2 : 1 Current Assets = 1,50,000 or 2
 Current Liabilities = ₹ 1,50,000 2
 Current Liabilities = ₹ 75,000 = ₹ 75,000 + ₹ 50,000 Current Liabilities before payment = ₹ 1,25,000

Working Capital

Before payment of Current Liabilities

 Working Capital = Current Assets – Current Liability = ₹ 2,00,000 – ₹ 1,25,000 = ₹ 75,000

After payment of Current Liabilities

 Working Capital = Current Assets – Current Liability = ₹ 1,50,000 – ₹ 75,000 = ₹ 75,000

What are Liquidity Ratios – Formulas and Examples

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

## Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

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