A company has a quick ratio of 1.5, current liabilities of Rs. 300,000, and inventory of Rs. 200,000. What are the company’s current assets?Rs. 450000Rs. 400000Rs. 500000Rs. 350000
Question
A company has a quick ratio of 1.5, current liabilities of Rs. 300,000, and inventory of Rs. 200,000. What are the company’s current assets?Rs. 450000Rs. 400000Rs. 500000Rs. 350000
Solution
The quick ratio is calculated as (Current Assets - Inventory) / Current Liabilities.
Given that the quick ratio is 1.5, current liabilities are Rs. 300,000, and inventory is Rs. 200,000, we can set up the following equation:
1.5 = (Current Assets - Rs. 200,000) / Rs. 300,000
To solve for Current Assets, we first multiply both sides of the equation by Rs. 300,000:
Rs. 450,000 = Current Assets - Rs. 200,000
Then, we add Rs. 200,000 to both sides of the equation to isolate Current Assets:
Current Assets = Rs. 450,000 + Rs. 200,000
So, the company's current assets are Rs. 650,000. However, this option is not given in your list. Please check the question or the options again.
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