| # | # |
| Capital 8000 | Plant and machinery 5000 |
| Net profit 4000 | Motor Van 4500 |
| Drawings 200 | Stock 2000 |
| Creditors 2000 | Debtors 1000 |
| Accurals 300 | Banks 100 |
| Cash 600 | |
| 14100 | 14100 |
A. 1 : 4
B. 5 : 1
C. 3 : 1
D. 2 : 1
Correct Answer:
Option A – 1 : 4
Explanation
Using the Balance Sheet, the current ratio is calculated by dividing current assets by current liabilities:
Current assets = stock + debtors + banks + cash
current liabilities = drawings + creditors + accruals
current assets = 2000 + 1000 + 100 + 600 =3700
current liabilities = 2000 + 200 + 300 = 2500
3700 ÷ 2500 = 1.4
300 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…
200 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…
200 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…
200 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…
200 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…
200 Level Estate Management and Valuation Department exam questions and detailed answers. Download the answers…