Illustration 4.1 From the following Balance Sheet of Lily Ltd., you are required to calculate the liquidity ratios and give your comments:

Liabilities Rs. Assets Rs. Share Capital: 60,000 shares Machinery 240000 Rs. 10 each 6900000 Buildings 250000 6% Debentures 2950000 Furniture and fixings 110,000 Reserves 110,000 Investment Bilis payable 60000 (shares in XYco. Ltd.,) 109,000 Trade creditors 40000 Inventories 1.20,000 Income Tax payable 25000 Bilis Receivable 45000 Trade creditors 40000 Inventories 1.20,000 Income Tax payable 25000 Bilis Receivable 45000 Outstanding expenses 40000 Trade debtors 60000 Bank overdraft 309000 Short-term investments 65000 Cash in bank 110,000 Cash in hand 55000 1155000 1155000