Multiple Choice Questions on A Company rsquo s liquid assets are Rs 5 00 000 and its current liabilities are Rs 3 00 000 Thereaft........... for UPSC EPFO Exam Preparation

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Multiple Choice Questions

A Company rsquo s liquid assets are Rs 5 00 000 and its current liabilities are Rs 3 00 000 Thereaft...........

General Accounting Principles Ratio analysis 
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    A Company’s liquid assets are Rs 5,00,000 and its current liabilities are Rs 3,00,000. Thereafter, it paid 1,00,000 to its trade payables. Quick ratio will be:

    1.33 : 1

    Incorrect Answer

    2.5 : 1

    Incorrect Answer

    2.5 : 1

    Incorrect Answer

    2:1

    Correct Answer
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    Explanation:

     liquid assets = Rs 5,00,000-Rs. 1,00,000(cash)= Rs. 4,00,000

    current liabilities = Rs 3,00,000-Rs.1,00,000(trade payables)=Rs.2,00,000

    quick ratio= liquid assets/ current liabilities

    RS. 4,00,000/ Rs. 2,00,000

    quick ratio=2:1

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