Britt Company
Selected data from Britt Company's financial statements are provided below:

-If a company's current ratio is 3.0 and the current liabilities are $100,000, then the current assets are:

Question

Britt Company 
Selected data from Britt Company's financial statements are provided below:

-If a company's current ratio is 3.0 and the current liabilities are $100,000, then the current assets are:

Quizplus · Accepted Answer

The current ratio is the ratio of current assets to current liabilities. Therefore, if the current ratio is 3.0, it means that for every $1 of current liabilities, there are $3 of current assets. So, to find the current assets, we can multiply the current liabilities by the current ratio: $100,000 x 3 = $300,000. Therefore, the best choice is B, $300,000.

Britt Company Selected Data from Britt Company's Financial Statements Are Provided Below