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Question : A Company's liquid assets are Rs.2,50,000 and its current liabilities are Rs.1,50,000. Thereafter, it paid Rs.50,000  to its trade payables. The quick ratio will be:

Option 1: 1.33:1

Option 2: 2.5:1

Option 3: 1.67:1

Option 4: 2:1


Team Careers360 12th Jan, 2024
Answer (1)
Team Careers360 23rd Jan, 2024

Correct Answer: 2:1


Solution : Answer = 2:1

Quick Ratio= $\frac{\text{Quick Assets}}{\text{Current liabilities}}$
New quick Assets = 2,50,000 - 50,000 = 2,00,000
New Current liabilities = Current liabilities – paid to trade payable 
                                   = 1,50,000 - 50,000
                                   = 1,00,000
New Quick Ratio = 2,00,000/1,00,000= 2:1.
Hence, the correct option is 4.

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