The ratio that averages about 2.0 for all industries is the
A) inventory turnover.
B) acid-test ratio.
C) current ratio.
D) debt-to-assets ratio.
E) debt-to-equity ratio.

Question

Quizplus · Accepted Answer

The current ratio, which is calculated by dividing current assets by current liabilities, averages about 2.0 across all industries. This ratio is a measure of a company's ability to pay off its short-term liabilities with its short-term assets.

The Ratio That Averages About 2