Question
Calculate the current ratios for the following:

a) current assets: \$700,000; current liability: \$350,000

b) current assets: \$300,000; current liability:
\$200,000

c) current assets: \$500,000; current liability: \$250,000

(a). Current ratio = 2 : 1

Explanation;

Current ratio = Current assets / Current liabilities

Current ratio = \$700,000 / \$350,000

= 2 : 1

(b). Current ratio = 1.50 : 1

Explanation;

Current ratio = Current assets / Current liabilities

Current ratio = \$300,000 / \$200,000

= 1.50 : 1

(c). Current ratio = 2 : 1

Explanation;

Current ratio = Current assets / Current liabilities

Current ratio = \$500,000 / \$250,000

= 2 : 1

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