Conceptual querry

Anuj Jain (pqr) (94 Points)

11 October 2012  

(QUE.1)   CURRENT RATIO IMPLIES THAT THE AMOUNT OF CURRENT ASSESTS AVAILABLE TO PAY EACH RUPEE OF CURRENT LIABILITES. IT IS CALCULATED BY USING THE FORMULAE    ( CURRENT ASSETS/ CURRENT LIABILITIES.) .

MY QUERRY IS THAT WHY DO WE INCLUDE PREPAID EXPENSES IN CURRENT ASSETS ALTHOUGH THEY ARE NOT AVAILABLE TO PAY CURRENT LIABILTIES.