Following Is The Balance Sheet Of Title Machine Ltd. As At March 31, 2017. -ACCOUNTING RATIOS
Following is the Balance Sheet of Title Machine Ltd. as at March 31, 2017.
| Particulars | Amount (Rs.) |
| I. Equity and Liabilities | |
| 1. Shareholders’ funds | |
| a) Share capital | 24,00,000 |
| b) Reserves and surplus | 6,00,000 |
| 2. Non-current liabilities | |
| a) Long-term borrowings | 9,00,000 |
| 3. Current liabilities | |
| a) Short-term borrowings | 6,00,000 |
| b) Trade payable | 23,40,000 |
| c) Short-term provisions | 60,000 |
| Total | 69,00,000 |
| II. Assets | |
| 1. Non-current Assets | |
| a) Fixed assets | |
| Tangible assets | 45,00,000 |
| 2. Current Assets | |
| a) Inventories | 12,00,000 |
| b) Trade receivables | 9,00,000 |
| c) Cash and cash equivalents | 2,28,000 |
| d) Short-term loans and advances | 72,000 |
| Total | 69,00,000 |
1. Current Ratio
Current Ratio = `\frac{Current asset}{Current liabilities}`
=`\frac{ 24,00,000}{30,00,000}`
= 0.8:1
Current Assets = Inventories + Trade Receivables + Cash + Short term Loans and Advances
= 12,00,000+ 9,00,000+ 2,28,000+ 60,000
= Rs. 24,00,000
Current Liabilities = Trade Payable + Short-term Borrowing + Short-term Provisions
= 23,40,000 + 6,00,000 + 60,000
= Rs.30,00,000
2. Quick
Quick Ratio = `\frac{Quick asset}{Current liabilities}`
= `\frac{12,00,000}{30,000}`
= 0.4:1
Quick Assets = Trade Receivables + Cash + Short term Loans and Advances
= 9,00,000 + 2,28,000 + 72,000
= Rs. 12,00,000
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