What does the current ratio measure?
A)The relative proportion of current versus noncurrent assets
B)Whether current assets are sufficient to pay current liabilities
C)The speed which current assets can be converted to cash
D)Whether cash is sufficient to pay current liabilities

Question

Quizplus · Accepted Answer

The current ratio,which is calculated by dividing current assets by current liabilities,tells you whether current assets are sufficient to pay current liabilities.A higher ratio means better ability to pay.

What Does the Current Ratio Measure