Jones Corp. reported current assets of $193,000 and current liabilities of $137,000 on its most recent balance sheet.
- The current ratio is:
A) 0.7:1.
B) 1:1.
C) 0.4:1.
D) 1.4:1.
E) 0.3:1.

Question

Quizplus · Accepted Answer

The current ratio is calculated by dividing current assets by current liabilities.

Current Ratio = Current Assets / Current Liabilities

Current Ratio = $193,000 / $137,000

Current Ratio = 1.41:1

Therefore, the current ratio for Jones Corp. is 1.4:1, which is closest to option D).