A company has a current ratio of of 0.85 to 1.What should a manager in the company worry about?
A)The company has too many assets and is not using them efficiently.
B)The company has too much inventory.
C)The company may start to have trouble paying salaries.
D)The company is paying salaries that are too high.

Question

Quizplus · Accepted Answer

A current ratio below 1 indicates that the company may not have enough current assets to pay off its current liabilities, including salaries. Therefore, the manager should worry about the possibility of the company having trouble paying salaries.

A Company Has a Current Ratio of Of 0