Normally a lower current ratio indicates a better financial position,for it implies that that a company has adequate liquidity to carry out business operations.

Question

Quizplus · Accepted Answer

This statement is incorrect. A higher current ratio indicates a better financial position as it implies that the company has more liquidity to carry out business operations. A lower current ratio may indicate potential difficulty in meeting short-term obligations.

Normally a Lower Current Ratio Indicates a Better Financial Position,for