Calculation of Liquidity Ratio :
1. Current ratio
2. Quick ratio
Year 2019
1. Current ratio
Current Ratio = Total Current assets / Total Current liabilities 16525/7866
Total Current Assets :- Cash & Cash equivalent + Short term investment + Account receivable + Inventories + prepaid expense
4466+ 197 + 4272 + 5622 + 1968 = 16525
Total Current liabilites = Current portion of Long term debt + Notes payable + Account payable + Accured pension liabilities + Income tax payable
6 + 9 + 2612 + 5010 + 229 = 7866
Current ratio is 2.1
2. Quick ratio
Quick ratio = Quick assets/ Current liabilities 8935/7866
Quick ratio = Current assets - Prepaid expense - Inventory
16525 - 5622 - 1968 = 8935
Currrent Liability = Already Calculated in upper of the question. So Current liabilities 7866
Quick ratio is 1.1
Year 2018
Current ratio
Current Ratio = Total Current assets / Total Current liabilities 15134/6040
Total Current Assets :- Cash & Cash equivalent + Short term investment + Account receivable + Inventories + prepaid expense
4249 + 996 + 3498 + 5261 + 1130 = 15134
Total Current liabilites = Current portion of Long term debt + Notes payable + Account payable + Accured pension liabilities + Income tax payable
6 + 336 + 2279 + 3269 + 150 = 6040
Current ratio is 2.5
2. Quick ratio
Quick ratio = Quick assets/ Current liabilities 8743/6040
Quick ratio = Current assets - Prepaid expense - Inventory
15134 - 1130 - 5261 = 8743
Currrent Liability = Already Calculated in upper of the question. So Current liabilities 6040
In 2018 Quick ratio is 1.4
Year 2019
Calculation of Solvency ratio :
Debt equity ratio = Long term debt/ Shareholder fund 3464/9040
Long term debt = 3464
Shareholder fund = 9040
Debt equity ratio is 0.3
Year 2018
Debt equity ratio = Long term debt/ Shareholder fund 3464/9040
Long term debt = 3468
Shareholder fund = 9812
Debt equity ratio is 0.35
Calculation of interest Coverage ratio :
Year 2019
Interest coverage ratio = Net profit before interest & Tax / Interset expense 4850/49
Net profit before interest & tax = Profit before tax + Interest charges
4801 + 49 = 4850
Fixed interest charges = 49
Interst coverage ratio is 98. 9 Times
Year 2018
Interest Coverage ratio = Net profit before interest & Tax / Interest expense
Net profit before interest & Tax = Profit before tax + Interest charges
4325 + 54 = 4379
Fixed interest charges = 54
Interest coverage ratio is 81 times
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