It is assumed that current liabilities are also ending balance
current ratio = current assets/current liabilities
current ratio = 1000/400 = 2.5 times
advance paid is current asset and advance received is current liability.
Current Asset
Current Liability
Sundry creditor is current liability.
expense owing is a current asset
advance paid is current asset and advance received is current liability.
Current Asset
Current Liability
asset Inventory is a current asset so when the required inventory is utilized the remaining inventory still remain as asset and not become liability. For example inventory of $100 purchase to use for production which is our current asset. when inventory of $90 utilized the remaining $10 is still our current asset while $90 become expense for production of units.
Sundry creditor is current liability.
expense owing is a current asset
Accounts receivable is a current asset, never a current liability.
No it is a current liability
Assets
None!- Its liability.
Payment On Current Liability Debit The Current Liability (say Sundry Creditor) (Liability Decreases) Credit Cash Or Bank (Current Asset Decreases)
current ratio = current asset divided by current liability