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Hi, sorry I got nobody to ask maybe you can help me out 🙁
I need to do a current ratio and quick ratio analysis i know i need to divide current assets on current liabilities but the problem is there also is Assets held for sale under current assets and Liabilities held for sale under current liabilities, do I need to include it?Someone said for current you count all together but for quick ratio don’t include those that are held for sale
On different statement it also looks like this: Liabilities of the disposal group classified as held for sale
Please if it’s not difficult hope you can help me!!
Kind Regards!If by ‘assets held for sale’ you mean inventory, then they are included in assets when calculating the current ratio but not included when calculating the quick (acid test) ratio.
I do not know what you mean by ‘liabilities held for sale’. Neither that nor ‘assets held for sale’ are normal accounting terms and nor are those terms used in the exam.
I really really appreciate your answer,
Could you please double check for me please as I am writing ratio analysis for current ratio and acid (not exam), one step you already clarified now it’s just this liabilities for sale
Here is the spf and spl, and in Current liabilities says Liabilities held for sale as well, do I include this when I calculate current and acid ratio or I need to ignore it? ( because need to divide on current liabilities and this is there in statement)
Kind Regards
Really appreciate!!!Also assets for sale are not really classfied as inventory as you can see they are separate same as liabilities.. That’s why I am so confuse what to include in current ratio and what in acid now..
🙁
https://www.tescoplc.com/media/474793/tesco_ar_2018.pdf another example of my question in current liability section and assets
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