An decrease in the current liabilities to total assets ratio will result in ________.
A) an increase in risk
B) an increase in profit
C) a decrease in risk
D) a decrease in profit

Question

Quizplus · Accepted Answer

A decrease in the current liabilities to total assets ratio indicates that the company can meet their short-term obligations with ease, which is generally considered to be a decrease in risk. However, it does not necessarily mean an increase in profit.

An Decrease in the Current Liabilities to Total Assets Ratio