Dratif Company's working capital is $33,000 and its current liabilities are $80,000.The company's current ratio is closest to:
A) 0.41 to 1.
B) 0.59 to 1.
C) 1.41 to 1.
D) 3.42 to 1.

Question

Quizplus · Accepted Answer

The current ratio is calculated as current assets divided by current liabilities. Given working capital (current assets - current liabilities) is $33,000 and current liabilities are $80,000, current assets are $113,000. Thus, the current ratio is $113,000 / $80,000 = 1.41 to 1.

Dratif Company's Working Capital Is $33,000 and Its Current Liabilities