From the following information, calculate current ratio.
[7M]
Rs.20,000
Trade receivables (debtors)
1,00,000
Bills payable
Prepaid Expenses
10,000
Sundry Creditors
Rs.40,000
Cash and cash equivalents
30,000
Debentures
Rs.2,00,000
Short term investments
20,000
Inventories
Rs.40,000
Machinery
7,000
Expenses Payable
Rs.40,000
Current Ratio = (Trade receivables + Cash and cash equivalents + Short term investments + Inventories) / (Sundry Creditors + Bills payable + Expenses Payable)
Current Ratio = (1,00,000 + 30,000 + 20,000 + 40,000) / (40,000 + 10,000 + 40,000)
Current Ratio = 1,90,000 / 90,000
Current Ratio = 2.11
Therefore, the current ratio is 2.11.