The current ratio is used to determine if the firm can meet its current obligations with its current assets.

Name: The current ratio is used to determine if the firm can meet its current obligations with its current assets.
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Question

Quizplus · Accepted Answer

The current ratio compares the current assets to the current liabilities of a firm to see if it has enough current assets to meet its current obligations. Therefore, option A is correct.

The Current Ratio Is Used to Determine If the Firm