In the work sheet of Parker Company, the current assets amount to $80,000, property and equipment is worth $150,000, current liabilities are $74,000, and long-term liabilities are $125,000. Which of the following is the current ratio of Parker Company? (Round to two decimal places.)
A) 1.08
B) 1.16
C) 0.95
D) 0.85
E) 1.21

Question

Quizplus · Accepted Answer

The current ratio is calculated by dividing current assets by current liabilities. For Parker Company, this is $80,000 / $74,000 = 1.08108, which rounds to 1.08.

In the Work Sheet of Parker Company, the Current Assets