A current ratio of 2.5 means that for every dollar of:
A)accounts payable,there is $2.50 of cash.
B)current liabilities,there is $2.50 of current assets.
C)current assets,there is $2.50 of current liabilities.
D)total liabilities,there is $2.50 of current liabilities.

Question

Quizplus · Accepted Answer

The current ratio is calculated by dividing current assets by current liabilities. A current ratio of 2.5 means that for every dollar of current liabilities, there is $2.50 of current assets.

A Current Ratio of 2