The current assets of Orangette Company are $292,500. The current liabilities are $130,000. The current ratio expressed as a proportion is
A) 225%.
B) 2.25:1.
C) .44:1.
D) $130,000 ÷ $292,500.

Question

Quizplus · Accepted Answer

Current ratio = current assets / current liabilities
Current ratio = $292,500 / $130,000
Current ratio = 2.25:1, which means that for every $1 of current liabilities, the company has $2.25 of current assets to cover those liabilities.

The Current Assets of Orangette Company Are $292,500