The current ratio helps financial managers evaluate the ability of a firm to pay shortterm liabilities as they come due.

Name: The current ratio helps financial managers evaluate the ability of a firm to pay shortterm liabilities as they come due.
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Question

The current ratio helps financial managers evaluate the ability of a firm to pay short­term liabilities as they come due.

Quizplus · Accepted Answer

The current ratio is a liquidity ratio that measures a company's ability to pay its short-term obligations with its current assets. Therefore, it helps financial managers evaluate a firm's ability to pay short-term liabilities as they come due.

The Current Ratio Helps Financial Managers Evaluate the Ability of a Firm