Long-term assets are $5,000, current liabilities are $700, and long-term liabilities are $3,000. If the current ratio is 3 to 1, then current assets are
A) $4,300
B) $2,100
C) $9,000
D) $6,900

Question

Quizplus · Accepted Answer

The current ratio is calculated as current assets divided by current liabilities. Given the current ratio is 3 to 1 and current liabilities are $700, current assets must be $700 * 3 = $2,100.

Long-Term Assets Are $5,000, Current Liabilities Are $700, and Long-Term