Current assets divided by current liabilities is equal to the:
A)Current ratio.
B)Quick ratio.
C)Debt ratio.
D)Liquidity ratio.
E)Solvency ratio.

Question

Quizplus · Accepted Answer

Current assets divided by current liabilities is the formula for calculating the current ratio. This ratio helps to determine a company's ability to pay off its short-term liabilities using its current assets.

Current Assets Divided by Current Liabilities Is Equal to The