Liquid Ratio

• Liquid Ratio = Liquid Assets/Current Liabilites

•Liquid assets =Current assets-stock-prepaid expenses Liquid Ratio =liquid assets/current Liabilities
•Cash Rs 18000 =160000/167000
•Debtors Rs 142000
•Closing =0.95
•stock Rs 180000
•Bills Payable Rs 27000
•Creditors Rs 50000
•Outstanding expenses Rs 15000
•Tax payable Rs 75000
•Find out Liquid ratio
•Liquid Assets = Current assets- Stock-Prepaid expenses
•Current Assets = Cash+Debtors+Closing Stock
• =18000+142000+180000
• =340000
•Liquid assets =current assets-stock-prepaid expenses
• = 340000-180000
• =160000
•Current Liabilities = B/P +Creditors+Outstanding Expenses+Tax payable
• =27000+15000=75000+50000 =167000

• =
• From the following information find out liquid ratio
• Sundry Cash in hand Rs 49000 ,Debtors Rs 50000,Sundry Creditors Rs
40000,Trade Investment Rs 20000,B/R Rs 30000,Prepaid Expenses Rs
10000,Closing Stock Rs 80000,B/P Rs 30000,outstanding expenses Rs
25000
• From the following information find out 1.current ratio2. Liquid ratio 3.Absolute liquidity ratio
• Cash Rs 18000,B/P Rs 27000,Creditors Rs 50000,debtors rs 142000,Closing stock Rs 180000,tax payable Rs 75000,outstsanding expenses Rs 15000
• Current assets =cash+debtors+stock
• =18000+142000+180000
• =340000
• Current Liabilities=B/P+Creditors+tax payable+outstanding expenses
• = 27000+50000+75000+15000
• =167000
• 1.Current Ratio=Current assets/Current Liabilities
• = 340000/167000
• =2.03
• Liquid Ratio = Liquid assets/current Liabilities
• Liquid assets=Current assets-stock-prepaid expenses
• = 340000-180000=160000
• =160000/167000
• = 0.96
• Absolute liquidity ratio=cash&babk+Marketable security/Current Liabilities
• =18000/167000
• =0.11
• Absolute Liquidity Ratio = Cash & bank + marketable security/Current Liabilities
• Creditors Rs 20000,Debtors Rs 30000,Cash at bank Rs 30000,
• B/P Rs 20000,outstanding expenses Rs 50000,cash at bank Rs 25000 find out
absolute liquidity ratio
• Current Liablities =creditors+outstanding expenses+B/P
• = 20000+50000+20000
• = Rs 90000
• Absolute liquidity Ratio= cash&bank + MS/Current liabilities
• = 30000+25000/90000
• =0.61
• Current Assets Current liabilities
• 1.stock or Inventories 1.Creditors
• 2.Debtors 2.Out standing expenses
• 3.prepaid Expenses 3. Bills payable
• 4.Cash in hand 4.Short term loan
• 5.Cash at bank 5.Prepaid Income
• 6.Short term Investment
• 7.Bills receivable
• 8.Outstanding Inome
CURRENT RATIO = CURRENT
ASSETS/CURRENT LIABILITIES
• From the following information find out current Ratio
• Stock Rs 200000
• Creditors Rs 100000
• Debtors Rs 200000
• Cash Rs 100000
• Short term Loan Rs 50000
• Outstanding Expenses Rs 30000
• Prepaid expenses Rs 40000
• Cash at bank Rs 20000
• Short term investment Rs 50000
• Current Ratio = Current Assets/Current Liabilities
• Current Assets= stock+Debtors+Cash+Short term Investment+ Prepaid exp+Cash at bank
• = 200000+200000+100000+50000+40000+20000=610000
• Current Liablities= Creditors+short term loan + Outstanding exp
• = 100000+50000+30000
• =180000
• Current Ratio=610000/180000
• =3.38
• From the following information find out Current Ratio
• Building Rs 500000
• Furniture Rs 200000
• Debtors Rs 150000
• Creditors Rs 120000
• Goodwill Rs30000
• Cash Rs 50000
• Short term loan Rs 40000
• Trade Investment Rs 50000
• Outstanding Expenses Rs 30000
• Prepaid expenses Rs 20000
• Bills receivable Rs 45000
• Bills payable Rs 25000
• Current Assets =Debtors + Cash + Trade Investment + Prepaid expenses + B/R
• = 150000 + 50000+ 50000+ 20000+ 45000 = 315000
• Current Liabilities = Creditors + Short term loan + out standing exp + B/p
• = 120000+ 40000+ 30000+ 25000
• =215000
• Current Ratio = Current Assets/Current Liabilities
• = 315000/215000
• =1.4
• From the following information find out current Ratio
• Premises -Rs 500000
• Furniture Rs 200000
• Building Rs 100000
• Debtors Rs 100000
• Creditors Rs 150000
• Bills payable Rs 30000
• Bills Receivable Rs 40000
• Cash at bank Rs 30000
• Cash in hand Rs 20000
• Short term investment Rs 150000
• Prepaid expenses Rs 150000
• Outstanding expenses Rs 120000
• From the following information find out current Ratio
• Debtors Rs 50000
• Cash at bank Rs 50000
• Creditors Rs 35000
• Fixed assets Rs 350000
• Intangible assets Rs 150000
• Bills payable Rs 50000
• Short term loan Rs 45000
• Short term investment Rs 55000
• Outstanding expenses Rs 50000
• Prepaid expenses Rs 40000
• Inventories Rs 200000
https://www.learncbse.in/accounting-ratios-cbse-notes-class-1
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