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Calculate the value of Current Liabilities and Stock if Current Ratio is 2.3 and Quick Ratio is 1.4 and Working Capital is $650,000.

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Question added by BASKAR SUNDARAM , Manager – Accounts and Finance , NASSER SAEED AL-HAJRI CORPORATION W.L.L
Date Posted: 2015/01/04
BASKAR SUNDARAM
by BASKAR SUNDARAM , Manager – Accounts and Finance , NASSER SAEED AL-HAJRI CORPORATION W.L.L

Current Ratio (Current Assets:Current Liabilities) =2.3:1

WC (CA-CL i.e.,2.3-1) =650000

Let1.3=650000

Hence CL (1) =650000/1.3 =500000

             CA (2.3) =500000*2.3 =1150000

QR =1.4:1

 

Hence QA (1.4) =500000*1.4 =700000

 

Hence Stock = CA-QA = =450000

 

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