The current ratio is computed as:
A) Current liabilities divided by current assets
B) Current assets divided by current liabilities
C) Current assets minus current liabilities
D) Current assets divided by total assets
E) None of the above

Question

Quizplus · Accepted Answer

The current ratio is computed as current assets divided by current liabilities, which is a measure of a company's ability to pay off its short-term liabilities with its short-term assets.

The Current Ratio Is Computed As