The current ratio is calculated as:
A)Current assets divided by noncurrent assets.
B)Current assets divided by current liabilities.
C)Current liabilities divided by noncurrent liabilities.

Question

Quizplus · Accepted Answer

The current ratio is a measure of a company's ability to pay off its short-term liabilities with its current assets. It is calculated by dividing current assets by current liabilities. Therefore, Choice B is the correct answer.

The Current Ratio Is Calculated As