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Accounting Ratios — Accountancy STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceAccountancyAccounting Ratios3 Marks
Question
Total Assets ₹ 22,00,000; Fixed Assets ₹ 10,00,000; Capital Employed ₹ 20,00,000. There were no Long-term Investments. Calculate Current Ratio.
Hints:
  1. Current Assets = Total Assets - Fixed Assets.
  2. Current Liabilities = Total Assets - Capital Employed.
✓

Answer

Current Assets = Total Assets - Fixed Assets
Fixed Assets = 10,00,000
Total Assets = 22,00,000
$\therefore$ Current Assets = 22,00,000 - 10,00,000 = 12,00,000
Current Liabilities = Total Assets - Capital Employed
= 22,00,000 - 20,00,000 = 2,00,000
$\text{Current Ratio}=\frac{\text{Current Assets}}{\text{Current Liabilities}}$
$=\frac{12,00,000}{2,00,000}=6:1$

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