Lesson eLearning

XYZ Ltd has current assets of Rs.1,80,000 and current liabilities of Rs.60,000. What is its current ratio? Express the answer to two decimal places.

easy 1 mark Class 12 · Accountancy · Accounting Ratios
Answer
3.00

The correct answer is 3.00 — Thus the current ratio is 3.00.

Step-by-step solution

  1. Identify current assets and current liabilities.
  2. Divide current assets by current liabilities: .
  3. Express the result to two decimal places: .
  4. Thus the current ratio is 3.00.
Common mistake: Forgetting to convert units or misplacing decimal points

Concept tested: Working capital measurement

Published · How this solution was prepared and checked

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