Draban Company's working capital is $38,000 and its current liabilities are $59,000.The company's current ratio is closest to:

Question

Quizplus · Accepted Answer

The current ratio is calculated as current assets divided by current liabilities. Given that working capital is current assets minus current liabilities, we can find current assets as $38,000 + $59,000 = $97,000. Therefore, the current ratio is $97,000 / $59,000 = 1.64 to 1.

Draban Company's Working Capital Is $38,000 and Its Current Liabilities