A current ratio of 1.5 to 1 for an organization suggests that the organization will not be able to meet its short-term debt obligations.

Question

Quizplus · Accepted Answer

A current ratio of 1.5 to 1 indicates that the organization has sufficient current assets to cover its current liabilities, meaning it is able to meet its short-term debt obligations. A current ratio of less than 1 would suggest a potential issue in meeting short-term debt obligations.

A Current Ratio of 1