Calculate Liquid Assets and Quick Ratio of the Company.
Calculate Liquid Assets and Quick Ratio of the Company.
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Rs 60,000 ; 0.6 : 1
Rs 1,00,000 ; 1 : 1
Rs 1,60,000 ; 1.6 : 1
Rs 2,60,000 ; 2.6 : 1
The Correct Option is A
Solution and Explanation
Step 1: Calculate Liquid Assets
Liquid Assets = Current Assets - Inventory
= ₹1,60,000 - ₹1,00,000 = ₹60,000
Step 2: Calculate Quick Ratio
Quick Ratio = Liquid Assets / Current Liabilities = ₹60,000 / ₹1,00,000 = 0.6 : 1
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Match List-I with List-II:
\[\begin{array}{|c|c|} \hline \text{List-I (Accounting ratio)} & \text{List-II (Type of ratio)} \\ \hline \text{(A) Current ratio} & \text{(I) Liquidity ratios} \\ \hline \text{(B) Stock turnover ratio} & \text{(II) Activity ratios} \\ \hline \text{(C) Debt Equity ratio} & \text{(III) Solvency ratios} \\ \hline \text{(D) Operating ratio} & \text{(IV) Profitability ratios} \\ \hline \end{array}\]
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