At 31 December 2019, Martha Limited has inventory of £48,000, trade payables of £68,000, cash at the bank of £22,000, trade receivables of £81,000, cash in hand of £1,000 and current tax payable of £15,000. Martha Limited also has a loan of £60,000 which is due for repayment by 5 annual instalments commencing on 30 June 2020. What is Martha Limited's current ratio?

Question

Quizplus · Accepted Answer

Current assets = £48,000 + £81,000 + £22,000 + £1,000 = £152,000Current liabilities = £68,000 + £15,000 = £83,000Current ratio = £152,000 / £83,000 = 1.60:1

At 31 December 2019, Martha Limited Has Inventory of £48,000