Following Is The Balance Sheet of Raj Oil Mills Limited As At March 31 ,2017 . Calculate Current Ratio-ACCOUNTING RATIOS

 1. Following is the Balance Sheet of Raj Oil Mills Limited as at March 31 ,2017 . Calculate current ratio.

Particulars	(Rs.)
I. Equity and Liabilities:
1. Shareholders’ funds
a) Share capital	7,90,000
b) Reserves and surplus	35,000
2. Current Liabilities
a) Trade Payables	72,000
Total	8,97,000
II. Assets
1. Non-current Assets
a) Fixed assets
Tangible assets	7,53,000
2. Current Assets
a) Inventories	55,800
b) Trade Receivables	28,800
c) Cash and cash equivalents	59,400
Total	8,97,000

Current asset =`\frac{Current     asset}{Current     liabilities}`

Current assets = Stock + Debtors + Cash at bank

                        = 55,800 + 28,800 + 59,400  

                        = 1,44,000 

Current liabilities = Trade Payable  

                             = 72,000

 

Current Ratio = `\frac{1,44,000}{72,000}`

                       =`\frac{2}{1}`

                       = 2:1

Chapter-5 Accounting Ratios-II

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