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    Question

    Find the current ratio of B limited data is as follows:

    Land & Building: 15,00,000 Preliminary Expenses: 1,50,000 Cash: Rs.100,000 Accounts Receivables: Rs.900,000 Inventory: Rs.10,00,000   Bank Overdraft: Rs. 900,000 Trade Creditors: 180,000 Debentures: 12,00,000
    A 2 Correct Answer Incorrect Answer
    B 1.85 Correct Answer Incorrect Answer
    C 2.8 Correct Answer Incorrect Answer
    D 1.9 Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Current Ratio (CR) = Current Assets/ Current Liabilities As such CR at present is = 20,00,000/1080000 = 1.85   Current Assets: Cash + Accounts Receivables + Inventory =100,000 + 900,000 + Rs.10,00,000 = Rs. 20,00,000   Current Liabilities: Bank Overdraft + Trade Creditors =Rs. 900,000 + 180,000 = Rs. 10,80,000

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