Accounting ratios-Important Questions

IMPORTANT QUESTIONS

CHAPTER 13: Accounting Ratios

  1. What are the advantages of ratio analysis?
  2. What is:-
    1. Current ratio
    2. Liquidity ratio
    3. Solvency ratio
  3. Calculate current ratio from the following:-
    Particular Rs. Particular Rs.
    Total Assets
    Fixed Assets (Tangible)
    Shareholder funds     		3,00,000
    1,60,000
    2,00,000    		 Non-current Liabilities
    Non-current Investments

    		 80,000
    1,00,000
  4. Current Ratio is 2.5; working capital is Rs. 60,000. Calculate the amount of current assets and current liabilities.
  5. Ratio of current assets (Rs. 10,00,000) to current liabilities (Rs. 4,00,000) is 25 : 1. The accountant is interested in maintaining a current ratio of 2 : 1 by acquiring some current assets on credit. Suggest him the amount of current assets that should be acquired.
  6. Inventories are Rs. 80,000; working capital Rs. 2,40,000; current assets; Rs. 40,000; calculate liquid/quick ratio.
  7. Calculate Debt to Equity ratio from the following information:-
    1. Total assets
    2. Total Debts
    3. Current Liabilities
    		 1,25,000
    1,00,000
    50,000
  8. Total Debts Rs. 15,00,000; current liabilities Rs. 5,00,000; capital employed Rs. 15,00,000. Calculate the total assets to debt ratio.