alleryStart learning →A company with current assets of 500 and current liabilities of 250 has a current ratio of:
AIt is half to one
BIt is two fifty
CIt is seven fifty
DIt is two to one
Answer & Solution
Correct answer: D. It is two to one
1. The current ratio is a straightforward division.
2. The current ratio represents the current assets divided by current liabilities.
3. Here current assets are 500 and current liabilities are 250.
4. Dividing 500 by 250 gives 2.
5. So the current ratio is two.
_Source: OpenStax Principles of Finance (CC BY 4.0), Ch 6 'Measures of Financial Health'_
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