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The current ratio of a firm with current assets of $300,000, current liabilities of $100,000, and inventory of $100,000 is:
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3 votes
The current ratio of a firm with current assets of $300,000, current liabilities of $100,000, and inventory of $100,000 is:

User Rmeador
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1 Answer

3 votes

Answer: 3.0

Step-by-step explanation:

The current ratio of a firm allows us to tell whether the company is able to pay off its current obligations using its current assets.

Current ratio is calculated by:

= Current assets / Current liabilities

= 300,000 / 100,000

= 3.0

Inventory is already included in current assets so there is no need to add it again.

User FallenAvatar
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