DK Goel Solutions Q 3 Chapter 3 Accounting Ratios Class 12 CBSE [2023-24]

(A) Current Ratio of a Company is 2 : 1. State giving reasons which of the following suggestions would improve the ratio, which would reduce it and which would not change it ?

1. I. Purchase of goods on Credit.
2. II. Purchase of goods against cheque.
3. III. Sale of goods Costing ₹ 50,000 for ₹ 60,000 on Credit.
4. IV. To sell a non-current asset at a slight loss.
5. V. To borrow money on a promissory note (B/P).
6. VI. To give promissory note to a Creditor.

(B) The current ratio of a company is 2.5 : 1. State giving reasons which of the following suggestions would improve, reduce and not change it :

1. (i) Payment to trade payables.
2. (ii) Sell machinery against cheque.
3. (iii) Sale of Inventory at loss on credit.
4. (iv) Cash collected from trade receivables.
5. (v) B/R dishonoured.
6. (vi) Issue of shares.
7. (vii) Issue of shares against the purchase of a building.
8. (viii) Redemption (Repayment) of Debentures maturing during the year.