The current ratio is a measure of a company's:
A)leverage.
B)solvency.
C)profitability.
D)liquidity.

Name: The current ratio is a measure of a company's: A)leverage. B)solvency. C)profitability. D)liquidity.
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Question

Quizplus · Accepted Answer

The current ratio measures a company's ability to pay its short-term obligations (those due within one year) with its current assets (assets that can easily be converted to cash within one year). This is a measure of liquidity, which is a company's ability to meet its short-term obligations.

The Current Ratio Is a Measure of a Company's